Attorney General Peter F. Kilmartin voiced his opposition to the "Financial CHOICE Act of 2017," which is scheduled for a vote on the floor of the House of Representatives this week, citing the measure would "effectively eviscerate the role of the Consumer Financial Protection Bureau" and "eliminate many of the critical consumer protections" implemented as a result of the Dodd-Frank Act, which was enacted with bi-partisan support in the wake of and in response to the 2008 financial crisis.
Kilmartin joined attorney general colleagues from several states in a letter to the leadership of the House of Representatives urging them to not rollback the critical measures that have helped millions of consumers across the country find relief from deceptive practices and held Wall Street accountable for its role in the national mortgage crisis and market meltdown.
If passed, the CHOICE Act would have devastating impact on consumers, specifically the Act would:
• Eliminate the CFPB's rulemaking and enforcement authority over unfair, deceptive, and abusive acts and practices; • Eliminate the CFPB's supervision and enforcement authority over large banks; • Eliminate the CFPB's authority to regulate payday and vehicle title loans; • Permit third-party debt collectors to charge usurious interest rates; • Eliminate the CFPB's rulemaking authority regarding mandatory arbitration; and • Reduce transparency and deprive consumers of a valuable source of information.
"The Republicans have wanted to dismantle the CFPB from the day it was created, and they are blinded by that position to see the real damage the CHOICE Act of 2017 will cause to the millions and millions of consumers who have benefitted from the protections the agency has put into place," said Attorney General Kilmartin. "The 'throw the baby out with the bathwater' approach to reforming the agency is short-sighted and ill conceived. I implore Congress to think about the people and not the fat cats on Wall Street and vote down this flawed Act."
In the joint letter sent to congressional leadership, the Attorneys General urged the House to oppose the legislation and to maintain the CFPB, which has proven to be a very effective advocate for the rights of consumers and an effective partner for the states in rooting out consumer abuses. Since its creation, the CFPB has achieved some remarkable results. As of January 1, 2017, the CFPB has handled over one million consumer complaints, and obtained $11.8 billion in relief for 29 million consumers. It has also taken enforcement actions to stem abuses by student loan originators and servicers, for-profit schools, debt collectors, credit reporting agencies, payday lenders, and foreclosure rescue companies, among others.
"The proposed Act will eliminate many of the critical consumer protections implemented as a result of the Dodd-Frank Wall Street Reform and Consumer Protection Act in the wake of, and in response to, the financial crisis," the Attorney Generals wrote. "As the chief consumer protection officers in each of our respective States, we write to call your particular attention to those portions of the Act that would effectively eviscerate the role of the Consumer Financial Protection Bureau, the only independent federal agency exclusively focused on consumer financial protection. The undersigned Attorneys General support the work of the CFPB and oppose any effort to curtail its authority."
"A rollback of these significant post-financial crisis rules and regulations would substantially harm consumers and the public in general," the Attorneys General conclude.
The letter was signed by a total of 20 Attorneys General, also including Xavier Becerra, California Attorney General; George Jepsen, Connecticut Attorney General; Matthew Denn, Delaware Attorney General; Karl A. Racine, District of Columbia Attorney General; Doug S. Chin, Hawaii Attorney General; Lisa Madigan, Illinois Attorney General; Tom Miller, Iowa Attorney General; Janet T. Mills, Maine Attorney General; Brian E. Frosh, Maryland Attorney General; Maura Healey, Massachusetts Attorney General; Lori Swanson, Minnesota Attorney General; Jim Hood, Mississippi Attorney General; Josh Stein, North Carolina Attorney General; Ellen F. Rosenblum, Oregon Attorney General; Josh Shapiro, Pennsylvania Attorney General; Peter F. Kilmartin, Rhode Island Attorney General; T.J. Donovan, Vermont Attorney General; Mark Herring, Virginia Attorney General; Bob Ferguson, Washington State Attorney General; and Stephen H. Levins, Executive Director of Hawaii's Office of Consumer Protection.