WASHINGTON — U.S. Sen. Mark R. Warner (D-VA) joined Sen. Jack Reed (D-RI) and a number of their Senate colleagues in a letter demanding that the Consumer Financial Protection Bureau (CFPB) perform its essential work supervising and investigating violations of consumer financial protection laws and taking forceful enforcement actions against scammers and payday lenders. This letter comes on the heels of an ill-advised move by the Trump administration to shutter the CFPB, which collects, investigates, and monitors consumer complaints about financial products and services, and provides relief to consumers who have been wronged by unscrupulous financial providers. 

As a consumer watchdog, the CFPB looks out for Americans’ financial wellbeing, preventing scams and holding offenders accountable. This is especially true for servicemembers, veterans, and their families. Since the agency's inception, the CFPB has returned over $21 billion back to consumers who have fallen victim to abusive and illegal activity.

“This morning, in your capacity as Acting Director of the Consumer Financial Protection Bureau (CFPB), you issued a directive to employees to cease all work without your express written approval.  This includes investigations, supervision, enforcement, and litigation activities, as well as all stakeholder engagement and public communications.  This decision leaves all Americans susceptible to predatory lending and other abusive practices, but in particular, it eliminates protections that prevent servicemembers from being exploited,” wrote the senators.

In this letter, the Senators also express The Trump Administration’s decision to stop supervision, enforcement, and litigation eliminates key protections enacted by Congress through the Military Lending Act (MLA) and Servicemembers Civil Relief Act (SCRA) to protect servicemembers, who are disproportionally targeted by predatory lenders and schemes, and often face greater financial risks than civilian borrowers due to the nature of their military service.  The financial and legal protections in these bipartisan laws – most notably a temporary reduction in interest rates on mortgages, credit cards, and auto loans – are critical to national defense and military readiness. 

“Nullifying the MLA and imperiling servicemembers’ rights under the SCRA will degrade military readiness, cost taxpayers money, and tarnish servicemembers’ records.  The Department of Defense (DOD) has stated that ‘high-cost debt can detract from mission focus, reduce productivity, and require the attention of supervisors and commanders.’  Morale suffers when servicemembers and their families are trapped in cycles of debt. And taxpayers are on the hook when our servicemembers leave the military due to avoidable personal issues like financial insecurity.  According to DOD, each separated servicemember costs the Pentagon more than $58,000,” they continued.

“Accordingly, we request that the CFPB continue to supervise and investigate violations of the consumer financial protection laws and take forceful enforcement actions against lenders that violate the law, especially when it comes to predatory lending that harms our military readiness. We also request that the CFPB continue to make public communications to consumers, especially to servicemembers regarding the rights that they are owed under the SCRA,” the letter concluded.

In addition to Sens. Warner and Reed, the letter was signed by U.S. Sens. Jeanne Shaheen (D-NH), Ben Ray Lujan (D-NM), Gary Peters (D-MI), Jeff Merkley (D-OR), Jon Ossoff (D-GA), Cory Booker (D-NJ), John Hickenlooper (D-CO), and Edward Markey (D-MA).

A copy of the letter is available here and below:                                                      

Dear Director Vought:

This morning, in your capacity as Acting Director of the Consumer Financial Protection Bureau (CFPB), you issued a directive to employees to cease all work without your express written approval.  This includes investigations, supervision, enforcement, and litigation activities, as well as all stakeholder engagement and public communications.  This decision leaves all Americans susceptible to predatory lending and other abusive practices, but in particular, it eliminates protections that prevent servicemembers from being exploited. 

This funding, supervision, enforcement, and communications freeze will hit military families especially hard.  Without a functional CFPB, military families will be stripped of their financial protections under the bipartisan Military Lending Act (MLA) that they have earned and deserve by serving our Nation.  The CFPB is the primary agency responsible for supervising and enforcing the MLA against nonbank financial companies, including payday lenders, pawnshops, and debt collectors who have charged servicemembers interest rates as high as 600% and who have threatened to derail their careers if they do not pay up. 

The agency’s supervision and enforcement program has delivered concrete results for the military.  The CFPB has resolved 39 cases involving harm to servicemembers and veterans, returning $363 million to victims, including six enforcement actions for violations of the MLA.  Two additional MLA cases are currently pending in court, alleging that a pawn shop and an installment lender charged sky high interest rates to military families and engaged in deceptive practices to illegally harvest fees.  With these cases frozen, no supervision, staff locked out, and additional enforcement off the table, unscrupulous lenders will exploit these circumstances to engage in additional predatory lending.  The actions that you have taken since being installed as Acting Director betray our servicemembers and empower scammers who want to rip them off.

Further, recent CFPB research identified a long-running pattern of lenders failing to decrease servicemembers’ interest rates while on active duty as required by the Servicemembers Civil Relief Act (SCRA).  These failures cost servicemembers thousands of dollars per year.  The CFPB’s public communications have held lenders accountable and helped servicemembers exercise their rights under Federal law.

Nullifying the MLA and imperiling servicemembers’ rights under the SCRA will degrade military readiness, cost taxpayers money, and tarnish servicemembers’ records.  The Department of Defense (DOD) has stated that “high-cost debt can detract from mission focus, reduce productivity, and require the attention of supervisors and commanders.”  Morale suffers when servicemembers and their families are trapped in cycles of debt.  And taxpayers are on the hook when our servicemembers leave the military due to avoidable personal issues like financial insecurity.  According to DOD, each separated servicemember costs the Pentagon more than $58,000.

Accordingly, we request that the CFPB continue to supervise and investigate violations of the consumer financial protection laws and take forceful enforcement actions against lenders that violate the law, especially when it comes to predatory lending that harms our military readiness.  We also request that the CFPB continue to make public communications to consumers, especially to servicemembers regarding the rights that they are owed under the SCRA. 

We request your commitment no later than February 12, 2025.  Thank you for your attention to this important matter.

Sincerely,

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