ICYMI: At Hearing, Senator Warren Highlights CFPB’s Work to Hold Big Banks and Corporations Accountable and Return Money to Working Families
Washington, D.C. — At a hearing of the Senate Banking, Housing, and Urban Affairs Committee, U.S. Senator Elizabeth Warren (D-Mass.) asked Consumer Financial Protection Bureau (CFPB) Director Rohit Chopra about the CFPB’s achievements over the last year to hold big banks and giant corporations accountable and put money back in working families’ pockets. The Senator asked Director Chopra about the Bureau’s work to eliminate junk fees, take on deceptive student loan servicers and shoddy tenant screening services, and eliminate medical collection debt from consumers’ credit reports.
Transcript: Hearing, “The Consumer Financial Protection Bureau’s Semi-Annual
Report to Congress”
U.S. Senate Committee on Banking, Housing, and Urban Affairs
Thursday, December 15, 2022
Senator Elizabeth Warren: Thank you, Mr. Chairman. Actually, I want to add my thanks as well to Senator Toomey. I want to thank you for your many years of public service and how well you have served the people of Pennsylvania and the people of the United States. I also want to say thank you for your willingness to work across the aisle. We don’t see eye to eye on every issue, in fact very few. But where we can, we do and I appreciate that.
So, let’s talk about CFPB.
Big business and their lobbyists have spent the last decade trying their hardest to take down the CFPB. And throughout it all, the CFPB has done its job, holding banks and giant corporations accountable.
It’s no wonder that the Chamber of Commerce and its corporate clients have now launched a new campaign, spending hundreds of thousands of dollars to attack the CFPB and to attack you, Director Chopra. And that’s on top of the many millions of dollars it has already spent fighting for giant banks and corporations’ in their right to cheat, trick, and discriminate against consumers.
So I just want to talk about a few of the things that CFPB does that big banks really seem to hate:
Director Chopra, one of the first things you did when you took over the CFPB was to launch an initiative against junk fees – the couple dollars here and couple dollars there that banks and other businesses are increasingly loading on families in order to boost corporate profits. We’re talking about things like way-high overdraft fees, hotel resort fees, other random fees that people can’t usually see until it’s too late.
The Bureau recently issued guidance to crack down on junk fees. I just want to ask you, how much do you think consumers will be able to save if you can get rid of these fees in their lives?
Consumer Financial Protection Bureau Director Rohit Chopra: Well our estimate is just on surprise overdraft fees. There’s about a billion that has already been cut out. And when it comes to others in the market, three billion in overdraft fees and I think the list is going to go on and on and on. Let me just say this. If you believe in a market system where people can compete with each other, when you hide fees or jam fees on people that they can’t reasonably avoid, that’s not really a market system to me.
Senator Warren: That’s right. Alright, so when financial institutions insist on continuing to saddle consumers with junk fees, you’ve been successful in taking enforcement actions against them. I see one here. Regions Bank, for example, was found to have charged surprise overdraft fees to its customers. How much money did CFPB recover for cheated consumers once it took on Regions Bank?
Director Chopra: So just in that one we got about $141 million in victim restitution and then a $50 civil penalty. It’s a repeat offender so we had to take it seriously.
Senator Warren: Yeah. And that’s money that stays in peoples’ pockets because of your work. Let me turn to another example.
The CFPB has also been working to protect student loan borrowers. You identified student loan servicers engaging in deceptive practices, in tricking teachers, and firefighters, and nurses out of the opportunity to access loan forgiveness under the Public Service Loan Forgiveness Program. Director Chopra, is this CFPB action going to put money back in the pockets of public servants like nurses and firefighters and teachers?
Director Chopra: Yes. They will have, in many cases, their financial lives will be completely different.
Senator Warren: Alright. So let’s take a look then at housing.
The CFPB has been looking into shoddy tenant screening services that too often result in families of color being unfairly denied rental housing. Earlier this year, the Bureau issued guidance warning tenant screening companies to clean up their practices. Director Chopra, will the CFPB’s work on this issue help reduce barriers to affordable, quality housing?
Director Chopra: Yes and it will also be good for landlords too who want to be able to find a tenant that works for them and not be shut out because of erroneous background reports about them.
Senator Warren: Alright so once again, making markets work better. Just making them work for consumers as well. I’m going to do one more quick example here.
Many people pay more for car loans, for credit cards and for mortgages because they have unpaid medical bills that tarnish their credit ratings. In March, the CFPB issued a report showing just how severe this problem is. And here’s what I love. Before you even had to deliver some kind of rule around this, a few weeks later, the three big credit-reporting agencies announced they would eliminate nearly 70 percent of medical collection debt from consumers’ credit reports. Director Chopra, how many families will this change impact?
Director Chopra: Millions I think. Inaccurate credit reporting, especially on medical debt, can be a blockade to so much and I think our work on credit reporting will continue to pay dividends for families and the economy.
Senator Warren: Well, I want to say thank you. There we have it. Junk fees, student loans, housing, and medical debt— I could keep going on if we had more time—all the things the CFPB has accomplished during your first year at the helm. The CFPB is saving tens of millions of families a lot of money.
I know that big banks and their lobbyists may hate that, but I’m glad to know that American families have a cop on the beat who’s working for them.
Thank you. Thank you, Mr. Chairman.
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