CHICAGO - Attorney General Kwame Raoul today joined a coalition of 23 attorneys general to defend the Consumer Financial Protection Bureau (CFPB) against efforts by the Trump administration and Elon Musk to defund and disband it. The CFPB is an independent agency that oversees big banks, lenders, credit card companies and mortgage servicers, and ensures companies follow federal consumer protection laws. Raoul and the coalition argue in their amicus brief filed in the U.S. District Court for the District of Maryland that dismantling the CFPB would significantly harm consumers and hamper enforcement of federal consumer protection laws.
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“Since its creation, the Consumer Financial Protection Bureau has assisted millions of Americans by helping homeowners facing foreclosure stay in their homes, stopping banks from charging junk fees and returning more than $20 billion to consumers nationwide,” Raoul said. “The CFPB expanded upon the work of states and federal partners to become the primary agency setting national rules to reign in the unfair and deceptive mortgage lending and servicing that directly led to the Great Recession. My office has partnered with the CFPB regularly to protect Illinois consumers, and I’m proud to stand with my fellow attorneys general against any attempts to dismantle this critical watchdog.”
On Feb. 9, the Trump administration directed the CFPB to stop all ongoing work and not begin any new investigations. In their brief, Raoul and the coalition argue that the administration’s efforts to destroy the CFPB could prevent consumers from reporting issues of fraud or deception. The attorneys general warn that efforts to shut down the CFPB would significantly reduce oversight of large banks, further harming consumers. As a result of the Trump administration’s actions, the nation’s largest banks are no longer being closely watched for compliance with key consumer protections by any federal regulator. The attorneys general caution that this may lead to financial institutions loosening their regulatory compliance, as was seen in the years leading up to the financial crisis.
The CFPB was formed in 2011 following the Great Recession to enforce federal consumer protection laws. Since its creation, the CFPB has worked with state attorneys general to address consumer issues related to banking, student loan servicers, mortgage servicers, auto lending, and other consumer financial matters. The CFPB has partnered with the Illinois Attorney General’s office and attorneys general throughout the country to stop deceptive, unfair and abusive conduct by companies, including joining with Raoul’s office and six other states to bring suit to stop an unlawful debt settlement scheme. The agency also partnered with Attorney General Raoul’s office and other attorneys general in investigating Navient and Nationstar Mortgage, known publicly as Mr. Cooper, for unfair and deceptive conduct in servicing student loans and mortgages respectively.
Joining Raoul in filing today’s brief are the attorneys general of Arizona, California, Colorado, Connecticut, Delaware, the District of Columbia, Hawaii, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, Rhode Island, Vermont, Washington and Wisconsin.
