Mick Mulvaney Wants to Put Millions of Americans at Risk; Why we must save the Consumer Financial Protection Bureau

A message from The Financial Clinic and Neighborhood Trust Financial Partners

In a 2014 interview with the Credit Union Times, a former South Carolina representative was asked how he and fellow lawmakers would like to reform the Consumer Financial Protection Bureau (CFPB). His response: if he had the political ability, he would like to get rid of the agency altogether. This representative was Mick Mulvaney who, as of November 2017, is the acting Director of the CFPB. While GOP lawmakers have floated abolishing the CFPB several times since Trump’s inauguration, this opposition is far from new and is far from over – just last week, Mr. Mulvaney hinted that he would like to end public access to the CFPB’s online complaints database, a tool that has been instrumental in holding companies accountable to the needs of their consumers.

The CFPB was established in 2010 as a legislative response to both the financial crisis of 2007-08 and subsequent Great Recession. Its sole purpose is to “protect consumers from unfair, deceptive, or abusive practices and take action against companies that break the law.” At the time, even top executives at some of the world’s largest financial institutions were quick to concede that more oversight was necessary to prevent some of the practices that induced the economic downturn. Unfortunately, less than a decade later, the political pendulum has swung back and resulted in a tenuous outlook for this federally funded bureau.

As national nonprofits dedicated to helping low-and-middle-income families achieve financial health, The Financial Clinic (the Clinic) and Neighborhood Trust Financial Partners (Neighborhood Trust) see firsthand every day how pervasive financial insecurity is for many Americans and the invaluable support they receive from the CFPB.

Brenda, an aspiring homeowner struggling to manage her delinquent student loan debts, worked with her Financial Counselor at Neighborhood Trust to organize a payment plan with each collection agency—except one. The collector reported the outstanding $13,000 balance as delinquent and was unresponsive to Brenda for months. Her Financial Counselor helped her make a formal complaint to the CFPB through a simple process. Within a month, the CFPB notified the collection agency that they were in violation of Brenda’s rights, resulting in the agency ceasing collections and removing the blemish from her credit report and allowing Brenda to become a homeowner later that year.

Ann, a 78-year-old woman, was concerned about the number of scams and solicitations that she was receiving. Neither she nor her family understood how to stop the harassment, especially by a particular fee-for-credit service. With her financial coach at the Clinic, she was able to use considerable resources of the CFPB to understand her rights and make an easy five-step complaint that took less than five minutes.

Brenda and Ann are just a couple examples of how the CFPB has helped hold third-party actors accountable and been a powerful ally and voice to consumers’ sometimes lonely fight. Yet, their stories, like millions of others, are often overshadowed by mainstream coverage of positive macroeconomic indicators—unemployment is down, inflation is stable, and the stock market was, until recently, hitting new all-time highs.

Financial insecurity is real, isolating, and daunting for the over 100 million low- to moderate-income (LMI) Americans who face it. Healthcare, daycare, and education costs have skyrocketed while stagnant wages and steady inflation have eaten away at LMI individuals’ ability to make ends meet. New business models are no longer constrained by geography; they enable freelance or “gig” work, which entail fewer workplace benefits and variable scheduling leading to income volatility and financial insecurity. In the context of our current economy, these Americans face a razor-thin margin of error where an unexpected overdraft charge or late payment fee can cause a setback that takes many months to recover from.

Americans should be able to navigate a financial landscape where terms hidden in small print can be crippling and credit reports are game-changers, but many people struggle to understand or even access their own reports. While resources can come in many forms—certainly paychecks and other types of income help—the most critical is access to information and supports that help Americans become their own advocates. Nevertheless, even the best self-advocates need a government that can help make a difference in both the large financial stresses and the smaller day-to-day ones. Few organizations have been a stronger ally to this end than the CFPB.

That’s why we are asking you to join us in supporting the CFPB and standing in opposition to any efforts being made to weaken or dismantle the agency, including the changing of its mission statement. Together, we aim to embrace and further the original mission of the CFPB that consumers should have the opportunity to achieve lasting financial security, free from predatory financial practices—one that should go far beyond the reach of partisan politics.

You can help by:

  1. Voicing your support for the CFPB and sharing your perspective. Write to us at administration@thefinancialclinic.org tweet us @NTFP_Official or @financialclinic, or share a story, audio, or video recording using our form. We will share these stories on social media and our websites, as well as invite others to join us in highlighting the potentially harmful impact that the disappearance of good actors could have on our clients and customers.
  2. Encouraging others to submit their complaints to the CFPB. The current CFPB Director has made it clear that the CFPB’s agenda will be set by examining consumer complaint content.

Americans like Brenda and Ann are counting on the CFPB. Now, more than ever, is the time to make our voices heard.