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Hensarling: For Struggling Americans, the Struggle Just Got Harder

Washington, Jun 2 -

WASHINGTON – House Financial Services Committee Jeb Hensarling (R-TX) released the following statement today about the CFPB’s controversial proposed rule to govern small dollar lending:

“Just days after the Federal Reserve reported that almost half of American families say they would struggle to pay for emergency expenses of $400, here comes Director Cordray to make their struggle even harder.  Accountable to no one, he alone decides for all Americans whether they can take out a small-dollar loan to meet emergency needs.  Minority business owner Robert Sherill testified before our committee that the small dollar loan he got after getting out of prison ‘was a lifeline’ because it enabled him to start a small business.  Today he employs 20 people.  He told us, ‘I had no other option.’  How many are going to lose this only option they may have? How many are going to have their utilities cut off or are going to lose their jobs because they can’t get money to repair their car and go to work? How many are going to lose out on the opportunity to start a small business and create jobs, like Robert Sherill did, or to work at a small business because it never gets started? It’s sheer arrogance to believe this Washington rule will help them.

“Director Cordray is running rough-shod not only over consumers but also the democratically-elected governments of all 50 states.  They already regulate small dollar loans and possess full authority to address any abuses.  When I asked Director Cordray to identify states he believes do not adequately protect consumers of small dollar lending, he declined to do so.  He also ignored concerns raised by state leaders like Arkansas Attorney General Leslie Rutledge and Indiana Attorney General Greg Zoeller.

“In doing so, Director Cordray wholly rejects the checks and balances built in to our constitutional system of federalism that is – or at least once was – a hallmark of American government. In its place, we are left with yet another one-size-fits-all Washington mandate from an unaccountable bureaucrat, the true legacy of Dodd-Frank.”

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