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Bipartisan Resolution Introduced to Stop CFPB Rule


Washington, Dec 1 -

A group of House Republicans and Democrats on Friday introduced legislation to nullify a controversial rule that would effectively ban millions of consumers from accessing short-term, small-dollar credit.  The rule was issued by the former director of the Consumer Financial Protection Bureau (CFPB) shortly before he left office.

Short-term, small dollar credit is essential to nearly 12 million American consumers who have difficulty qualifying for many other types of credit.  These loans may not fit the needs of all consumers in all circumstances but are often essential to help them meet their needs.  Many people also use these short term loans to bridge an emergency such as an unexpected car repair or medical bills. 

These short-term, small-dollar loans are already regulated by all 50 states, the District of Columbia and Native American tribes.  The CFPB’s rule would mark the first time the federal government has gotten involved in the regulation of these loans.

The legislation introduced today uses Congressional Review Act authority to repeal the rule and prevent the Bureau from issuing a similar rule in the future.  The bill is sponsored by Rep. Dennis Ross (R-FL) and co-sponsored by Reps. Alcee Hastings (D-FL), Tom Graves (R-GA), Henry Cueller (D-TX), Steve Stivers (R-OH) and Collin Peterson (D-MN).

House Financial Services Committee Chairman Jeb Hensarling (R-TX), a supporter of the bipartisan effort, said the CFPB’s rule is an example of how “unelected, unaccountable government bureaucracy hurts working people.”

“Once again we see powerful Washington elites using the guise of ‘consumer protection’ to actually harm consumers and make life harder for lower and moderate income Americans who may need a short-term loan to keep their utilities from being cut off or to keep their car on the road so they can get to work,” he said.  “Americans should be able to choose the checking account they want, the mortgage they want and the short-term loan they want and no unelected Washington bureaucrat should be able to take that away from them.”

Rep. Ross said, “More than 1.2 million Floridians per year rely on Florida’s carefully regulated small-dollar lending industry to make ends meet. The CFPB’s small dollar lending rule isn’t reasonable regulation — it’s a de facto ban on what these Floridians need. I and my colleagues in Congress cannot stand by while an unaccountable federal agency deprives our constituents of a lifeline in times of need, all while usurping state authority. Today, we are taking bipartisan action to stop this harmful bureaucratic overreach dead in its tracks.”

Additional resources:

Minority small business owner testifies “the payday loan I got…was a lifeline.”

Testimony of Indiana Attorney General Greg Zoeller

Testimony of Sherry Treppa, Chairperson of the Habematolel Pomo of Upper Lake

Hearing on the CFPB’s Assault on Access to Credit and Trampling of State and Tribal Sovereignty

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