Today, in response to the Consumer Financial Protection Bureau’s announcement that it is reconsidering its 2017 Payday, Small-Dollar, and Car Title rule that would put a stop to abusive payday loans, Congresswoman Maxine Waters (D-CA), Chairwoman of the House Financial Services Committee, issued the following statement:
“I am deeply troubled by the Consumer Bureau’s proposal to gut a much-needed rule that would have reined in payday lenders and ensure consumers can afford to pay off their loans. It is no secret that payday loans often lead to irreparable financial consequences for hardworking families, as they usually have interest rates of 300 percent or more, and borrowers frequently take out new loans to pay off old ones because the loans were never affordable in the first place.
“Under the leadership of former Director Richard Cordray, the Consumer Bureau took an important step to protect consumers from predatory debt traps but his successors seem to be working hard to assist payday loan sharks and repeal important consumer protections.
“This proposal essentially sends a message to predatory payday lenders that they may continue to harm vulnerable communities without penalty. I urge Director Kraninger to rescind this proposal and work on implementing a comprehensive federal framework -- including strong consumer safeguards, supervision, and robust enforcement -- to protect consumers from the cycle of debt.”
Chairwoman Waters has consistently fought to protect consumers against predatory lending and other abusive practices.
In 2018, she issued the Consumer First Act, a bill to block the Trump Administration’s anti-consumer agenda and reverse their efforts, led by Mick Mulvaney, Director of the Office of Management and Budget, to dismantle the Consumer Financial Protection Bureau.
In 2017, she was one of the strongest supporters of the Consumer Bureau’s final rule on payday, vehicle title, and certain high cost installment loans and fiercely opposed the Trump Administration and Congressional Republicans’ efforts to rescind regulations meant to protect consumers.
In 2016, she issued a staff report on payday lenders skirting state law as further evidence of the need for a robust federal standard.