Payday Lenders Want Supreme Court to Gut the CFPB. They Paid $200 Million in Fines to Regulators, Records Show
By Chris Matthews
Critics warn of 'destabilizing' consequences for financial system if lawsuit is successful
The Supreme Court will hear oral arguments next Tuesday in a case that could reshape the U.S. regulatory state, after a federal appeals court found the funding structure of the Consumer Financial Protection Bureau to be unconstitutional.
If the Supreme Court agrees with the lower court ruling in the case CFPB v. Community Financial Services Association of America, it's possible that the entire agency may be eliminated by judicial fiat, an outcome that may be very profitable for the payday lending industry.
That's according to a new report from the left-leaning corporate watchdog Accountable.US, shared exclusively with MarketWatch, which shows that the CFSA, the group suing the CFPB, comprises more than a dozen payday lending companies who have paid more than $204 million in fines and restitution to federal and state regulators.
"Predatory lenders notorious for charging 400% interest rates and tricking Americans into endless cycles of debt want to tie up the nation's top consumer watchdog with bureaucratic red tape," said Liz Zelnick, director of Accountable's economic security and corporate power program.
"This lawsuit is the crown jewel in a well-coordinated, long-running scheme to put the CFPB out of commission by industries that hold contempt for the very idea of consumer protection," she added.
Accountable.US. is attempting to raise awareness of what the industry stands to gain from a hamstrung CFPB though an effort, launched Tuesday, called Defend American Consumers.