Documents related to settlements at the federal consumer financial protection agency that did not require companies to provide redress to harmed consumers are being sought by two key lawmakers, according to a letter they sent to the agency’s director Thursday.
House Financial Services Committee Chairwoman Maxine Waters (D-Calif.) and oversight and investigations subcommittee Chairman Al Green (D-Texas) sent the letter to Consumer Financial Protection Bureau (CFPB) Director Kathleen (“Kathy”) Kraninger seeking the documents.
“The Consumer Financial Protection Bureau has recently announced several settlements against entities for engaging in unlawful practices without requiring the payment of redress to consumers harmed by the illegal conduct,” Waters and Green wrote. “This stands in stark contrast to the Consumer Bureau’s practice under the leadership of former Director Cordray.”
They asserted that, during Cordray’s tenure, the bureau recovered nearly $12 billion in relief for harmed consumers over its first six years. “American consumers deserve a Consumer Bureau that will fight to recover their hard-earned money when they are cheated,” they wrote.
In particular, the lawmakers pointed to recent settlements reached by the bureau, including with NDG Financial Corp. The proposed settlement dealt with up to nine payday lending groups and three individuals, and would permanently ban them from offering the typically short-term, high-interest loans to any consumer in the U.S. and bar them from collecting on existing loans, the federal consumer financial protection agency said Friday. However, the settlement, the lawmakers said, included neither a penalty nor restitution to consumers.
The House committee leaders also zeroed in on recent settlements reached with Sterling Jewelers Inc. and Enova International, Inc.
“The Committee has serious concerns about how the Consumer Bureau is exercising its enforcement authority, especially how it is determining whether to require companies to pay redress to consumers that have been harmed,” Waters and Green wrote. “The fact that two of the three settlements involve online lending raises serious questions about the Consumer Bureau’s commitment to protecting America’s consumers from predatory online lending practices.”