NACA Leaders to CFPB: Be More Vigilant Against Financial Abuses During COVID-19 Crisis
Consumer financial harms stemming from the COVID-19 pandemic will only worsen in communities across the country if the Consumer Financial Protection Bureau (CFPB) does not vigorously enforce the consumer protection laws under its jurisdiction, state leaders of the National Association of Consumer Advocates (NACA) warned today.
In a letter sent to CFPB Director Kathleen Kraninger, 42 NACA state chairs representing 34 states and Washington, DC, raised their concerns that CFPB’s activities so far, nearly two months since the presidential declaration of emergency, are insufficient to stem the serious financial troubles that threaten working families.
“We anticipate that as the unpredictable crisis unfolds, consumers will be overwhelmed by harmful and exploitative conduct from unscrupulous market actors,” the letter said. “The agency’s actions, such as restricting the flow of critical data reporting and allowing entities to delay their compliance with federal financial laws, along with the bureau’s insistence with proceeding with non-essential rulemaking, are doing more harm than good for consumers.”
The letter said that longstanding problems such as debt collection abuse, unlawful vehicle repossessions, credit reporting violations, and deceptions in mortgage and student loan servicing are likely to become more prevalent as a result of the crisis.
“Debt collectors, notorious for their aggressive and abusive conduct, should be closely monitored (and credit) bureaus and furnishers should be made to comply with the Fair Credit Reporting Act at all times,” the letter said. “Lenders should be strongly discouraged from making costly, high-interest loans (and the) CFPB should work with all mortgage and student loan servicers to employ practices that would help borrowers stay in their homes or avoid default.”
NACA’s leaders also urged the bureau to ensure that specific COVID-19 relief measures available under the CARES Act and other decrees are strictly adhered to, and that regulated entities are fulfilling promises made to customers.
“Working families should be shielded from fraudulent, and unfair and deceptive business practices, especially now,” said the letter. “We hope that the agency will exercise its authority to act with more substance and with greater urgency.”