Could Trump’s Election Be Good News For The Underbanked?
On the surface, the incoming Trump administration looks like a disaster for consumer activists. After eight years of successfully pressing the government to back financial protections for consumers, they could see their work quickly unravel in January.
The Consumer Financial Protection Bureau, brainchild of Sen. Elizabeth Warren (D-MA), may be severely crippled by a Republican Congress, if not dismantled entirely. Payday lenders already are taking a victory lap in the belief that proposed rules the CFPB has worked on for years to limit high-rate payday loans and end arbitration clauses in consumer contracts will never happen.
The Dodd-Frank regulations to limit bank risks and behavior in the wake of the 2008 financial crisis — enacted after a hard-fought political battle — are a high-profile target of both President-elect Donald Trump and conservative lawmakers.
And, following a surprise federal court ruling limiting the agency’s autonomy, there’s speculation Trump may follow up on threats to fire Director Richard Cordray on day one of his presidency. “Most insiders think the CFPB is about to get a ‘haircut’ by decapitation on the sharp edge of a guillotine,” consumer advocate Adam Levin, former director of the New Jersey Division of Consumer Affairs, wrote recently.