House Members Introduce CRA to Repeal CFPB Rule Protecting Consumers from Predatory Payday, Car Title, and Other Short-Term Lending
WASHINGTON, D.C. – Today, industry-backed members of Congress announced they will use a legislative maneuver known as the Congressional Review Act in an attempt to repeal the Consumer Financial Protection Bureau’s (CFPB) new rule protecting consumers from predatory payday, car title and other short-term lenders. The new rule marks the culmination of five years of research, outreach, and careful consideration of more than one million public comments.
The House effort to repeal the payday lending rule is co-sponsored by Reps. Dennis Ross (R-FL), Alcee Hastings (D-FL), Tom Graves (R-GA), Henry Cuellar (R-TX), Steve Stivers (R-OH), and Colin Peterson (D-MN) – collectively, these members of Congress have taken $471,725 from the payday lending industry over the course of their congressional careers. [Center for Responsive Politics, Accessed 12/1/17]
The CFPB’s rule is designed to protect the more than 12 million Americans who fall victim each year to the underhanded business practices of payday lenders – an industry that rips off consumers and deliberately traps them in cycles of debt with interest rates exceeding 300, even 500 percent. Lenders will now be required to take a borrower’s ability to repay a loan into consideration before loading them up with debt they may never be able to pay back on time.
“The Consumer Financial Protection Bureau’s new rule takes a common-sense approach to end the debt trap and protect consumers. It took years to get here, and with victory now in sight industry-backed politicians in Congress are attempting to reverse course for their predatory pals in payday lending,” said Karl Frisch, executive director of Allied Progress.
He continued, “For years, the payday lending industry has plied powerful politicians at every level of government with campaign contributions – they’ve spent even more on lobbying and efforts to stymie regulators at the CFPB. Make no mistake this industry will do whatever it takes to keep their predatory racket humming along. Millions of Americans are counting on us to fight back and protect these important new rules – and that is exactly what we are going to do. We will fight back and we will win.”
Earlier this year, Allied Progress debunked criticisms by the payday lending industry that, during the rulemaking process, the CFPB ignored consumers who had favorable opinions of payday loans. In just minutes, an Allied Progress analysis was able to find hundreds of individually submitted, supposedly personal public comments that included many of the exact same personal stories, sentences, and paragraphs – word-for-word – in support of payday loans and opposition to the CFPB’s proposed rule. More on that here.
Allied Progress launched PaydayLendingFacts.org to expose the payday lending industry, combat misinformation, and provide the public with the truth about payday lenders and their allies in Congress. The website features hundreds of pages of easily accessible research.