CFPB Backs Off Investigating The Massive Equifax Breach

MarketWatch reported on Monday that the Consumer Financial Protection Bureau (CFPB) has:

"...  scaled back its investigation into a data breach at credit reporting agency Equifax Reuters reported Monday. The CFPB's interim director Mick Mulvaney, appointed by the Trump administration, has not followed "routine steps" that would be involved in a probe, including issuing subpoenas against Equifax and seeking sworn testimony from its executives, Reuters reported.

And when regulators at the Federal Reserve, Federal Deposit Insurance Corp. and Office of the Comptroller of the Currency have offered to help examine the credit bureaus, the CFPB reportedly declined the help... several politicians and consumer advocates said this is the latest sign the CFPB under Mulvaney will be weak in its prosecution of financial firms... The Federal Trade Commission is also investigating the breach, but imposes financial penalties more rarely than the CFPB does... Mulvaney wrote in an op-ed published in January The Wall Street Journal that the bureau will no longer “push the envelope.” “When it comes to enforcement, we will focus on quantifiable and unavoidable harm to the consumer,” he wrote..."

The massive Equifax data breach affected at least 143 million persons in the United States. That was about 44 percent of the United States population... almost half. Nobody in their right mind wants to experience that again, so a thorough investigation seems wise, appropriate, and necessary.

The CFPB began supervision of the credit reporting industry in 2012. While the news report by MarketWatch is very troubling, sadly there is even more bad news:

"Consumer advocates are also concerned that the CFPB will get rid of the database of complaints related to current investigations, which allows the public to air complaints publicly. It also provided a direct way for the public to engage with the CFPB’s activities. The database contains hundreds of thousands of complaints filed by consumers about issues ranging from predatory debt collectors to errors on credit reports. Republicans have argued that the database shouldn’t be public, while consumer advocates say the public list of complaints is an important tool for consumers.

A public database has been “a powerful mechanism for keeping financial predators accountable to consumers,” Melissa Stegman, senior policy counsel at the Center for Responsible Lending, a nonprofit based in Durham, N.C., told MarketWatch... Mulvaney announced in January the CFPB may reconsider a rule Cordray implemented for payday lenders that was designed to protect consumers and limit the amount lenders are allowed to loan them, if they do not meet certain borrowing criteria."

Now, you know why you should be concerned, too, about foot-dragging by the CFPB's Equifax probe. There is plenty of evidence that the CFPB has done a spectacular job protecting consumers and their money:

• The CFPB database identified debt collection issues as the number one complaint by consumers in 2017. Without this database, there's no way to know how bad things are in the banking, financial services, and credit reporting sectors
• In January 2017, the CFPB fined TransUnion and Equifax $23.1 million for deceptive advertising practices related to credit scores and subscription services
• In 2016, the CFPB achieved a settlement agreement forcing Wells Fargo bank to pay a $100 million penalty for unlawful sales practices. The investigation revealed that bank employees had opened 1.5 million fake bank accounts, e-mail accounts, and debit cards costing account holders $2 million in bogus fees; all without account holders' knowledge nor consent... to game the bank's sales incentive systems
• In 2015, the CFPB began efforts to ban binding arbitration clauses, which many companies insert into their terms of service and other contractors with consumers. These anti-consumer clauses restrict consumers' freedoms to sue companies and to join class-action lawsuits
• In March 2012, the CFPB began accepting complaints from consumers about bank accounts (e.g., checking, savings, CDs, poor customer service, etc.). Later in 2012, the CFPB began accepting complaints about student loans, credit cards, and credit reports. In March 2013, the CFPB first released data results from its Consumer Complaints database. This quickly became a reliable source of tracking key financial issues affecting (and abusing) consumers.

While campaigning for President, Donald Trump positioned himself as a populist... promoting "populist nationalism." A true populist would not appoint a CFPB director that weakens or abandons protection for consumers. What do you think?