People are most likely to lose their rights when they don’t notice encroachments on them, and the Trump Administration is counting on that. Last week, a news cycle already crowded with news of a possible government shutdown, the Winter Olympics and the latest personnel scandal at the White House also quietly reported -in a series of articles from various press outlets – a sea change was quietly taking shape within the Consumer Financial Protection Bureau (CFPB).
First, the New York Times uncovered a clear connection between campaign contributions from the payday lending industry to now-Interim CFPB Director Mick Mulvaney and a sudden lack of interest in pursuing predatory payday lenders by the agency. Mulvaney has not only stopped enforcement actions against payday lenders who mislead consumers into thinking that loans are cheaper than they really are, he’s also trying to stop the agency’s years-in-the-making empirical evidence-based rulemaking to limit the most extreme abuses of payday lending.
Then there was news that the agency was also backing away from its investigation into the Equifax data breach, which exposed millions of Americans’ most important, and private, personal information to online hackers. It’s sort of shocking that a huge corporation letting criminals have 145 million Americans’ social security numbers, addresses, and many other personal details isn’t grounds for ANY enforcement action by the Bureau.
And then there was the CNBC report highlighting the many different – and devastating – ways the Administration was already working to “rein in” Washington’s most important watchdog.
This morning, we learned what all those moves were ultimately leading to: In a memo obtained by National Public Radio, Mulvaney outlines a “revised mission and vision of the bureau” that, essentially, will bring the CFPB’s most important work to a screeching and sudden halt.
If you thought Wells Fargo already got away with highway robbery by opening millions of unauthorized checking and credit card accounts and then using its forced arbitration clause to sharply limit its liability, just wait until Mulvaney fully executes this plan.
As NPR reports, Mulvaney has already personally intervened to stop CFPB investigations on behalf of consumers defrauded by lenders and banks. One such investigation was looking at the tactics used by Golden Valley Lending, a company whose loan terms turned one consumer’s $900 loan into a $3,735 debt.
Julie Bonenfant, who turned to Golden Valley when she was facing eviction from her apartment, was led to believe – by the company’s website – that she would repay her $900 loan in four installments. “But after those four payments,” NPR reported this morning, “the lender continued to take money directly out of her checking account. When she asked why, the lender told her she had agreed online to a lot more payments.”
Under former CFPB Director Rich Cordray, the agency sued Golden Valley. Within months of taking over as Interim Director, Mulvaney dropped the lawsuit. CFPB employees who spoke to NPR on the condition of anonymity said that Mulvaney insisted on ending the suit “even though the entire career enforcement staff wanted to press ahead with it.”
As a Congressman, Mulvaney received $62,000 in campaign cash from payday lenders like Golden Valley.
The message couldn’t be clearer: Big banks and predatory lenders are looking to collect a return on their investment in Mick Mulvaney’s political career.
But Mulvaney – and the entire Trump Administration – should consider the political implications of what they’re poised to do. A large, bipartisan majority of voters supported the CFPB’s work under the agency’s prior Director. And Trump’s own voters, including Julie Bonenfant, are beginning to take notice, too.
"To be honest I'm really mad, really pissed, because I actually voted for Trump," Bonenfant told NPR. "So knowing that his guy threw out this case that affects people like me. I feel kind of like stupid — just kind of like betrayed."
Multiply that sense of betrayal by the millions wronged by Wells Fargo, Equifax and now-jailed payday lending magnate Scott Tucker (to name just a few corporate cheaters protected by Mulvaney’s actions) and you start to get some idea of the potential consequences of gutting one of the most popular agencies in the federal government.
The Trump Administration must be counting on the idea that voters won’t notice that Mulvaney’s “new strategic plan” completely disregards its own voters in favor of corporate donors. And while voters like Bonenfant may feel fooled by the President’s promises, Mulvaney is, at least, being quite honest with them now. In a series of Sunday morning interviews – which some have pointed out turned into a disturbing defense of domestic violence allegations against the President - Mulvaney freely admitted that, under his watch, the CFPB “is not being aggressive.”
For voters like Bonenfant, that may be an understatement that compels them to the polls in November (and beyond).
And even though Mulvaney seems hell bent on implementing his new “vision” – even as early as today – the President does have an opportunity to win back voters like Julie Bonenfant: He can replace Mulvaney with a truly independent Director – as Congress always intended – who will steer the agency back to its original (and popular) mission.
Anything short of that, however, multiplies the risk that legions of “really mad, really pissed” voters will notice the ways they have been betrayed, and act accordingly at the ballot box in November. Because at the end of the day, the truth is that what the CFPB needs isn’t a new vision. It’s a new leader.