Washington – The Trump administration ordered the consumer financial protection office to stop almost all of its work, effectively closing an agency that was created to protect consumers after the 2008 financial crisis and the risk mortgage scandal.
Russell Vought, the Newly installed director From the management and budget office, led the CFPB, in a Saturday evening e-mail confirmed by the Associated Press, to stop the work on the rules proposed, to suspend the effective dates on all the finalized rules but not Still effective, and to stop investigating to work and not starting new surveys. The agency has been a target of the Conservatives since President Barack Obama pushed to include it in the 2010 financial reform legislation which followed the 2007-2008 financial crisis.
The email also ordered the office to “cease any supervision and examination activity”.
Since the CFPB is a creation of the congress, it would require a distinct act of the congress to officially eliminate it. But the chief of the agency has the discretionary power on the measures to apply the law to be taken, if necessary.
Yet Elon Musk commented “CFPB RIP” Friday, on the social media site. And the CFPB home page on the Internet was SundayReplaced by a message reading “page not found”.
Very Saturday evening, Vought said in an article on social networks that the CFPB would not withdraw its next series of funding from the Federal Reserve, adding that its current reserves of $ 711.6 million is “excessive”. The congress managed the office which will be funded by the Fed to isolate it from political pressures.
“This tap, long contributing to the disadvantage of the CFPB, is now being deactivated”, Vought said on x.
The CFPB claims that it has obtained nearly $ 20 billion in financial relief for American consumers since its foundation in the form of canceled debts, remuneration and reduced loans. Last month, the Bureau continued Capital One for having pretended to have been deceived consumers about its offers for high interest savings accounts – and “cheating” customers of more than $ 2 billion in payments of lost interest accordingly.
Dennis Kelleher, president of Better Markets, a defender’s defense group, said: “This is why the biggest banks of Wall Street and the billionaire allies of Trump hate the office: it is an effective cop And the Americans – Republicans and Democrats were held in Long, fighting against financial predators, crooks and crooks. »»
The administration’s decision against the CFPB also highlights tensions between Trump’s more populist promises to reduce costs for working class families and its commitment to reduce government regulations.
During the campaign, Trump declared that he ceiling the interest rates of the credit card at 10%, after climbing up levels above 20%, on average, because the federal reserve has lifted the rates interest in 2022 and 2023. The CFPB had started working on the way in which this proposal would be implemented.
The office can always make complaints, but it cannot make exams or pursue existing surveys, according to a person familiar with the agency that insisted on anonymity to discuss the activities of the CFPB. Memo is also interpreted as blocking communication with companies it regulates, consumer defenders or other external groups.
The Musk team would also have access to complaints, investigations and regulatory monitoring data. Access raises uncomfortable questions if Musk’s Company X is launching a payment system because the CFPB had data on competitors such as Cash App, the person said.
Vought’s email follows a similar directive by the Treasury Secretary Scott Bessent on February 3 and is the Trump’s last decision to quickly reduce the work of the federal agencies they deemed excessive.
Obama directed the creation of the office following the 2007-2008 financial crisis bubble, which was partly caused by fraudulent mortgage loans. It was an original idea of the Massachusetts Democrat Senator Elizabeth Warren and attracted prosecution of large banks and commercial associations of the financial industry.
“Vought gives large banks and giant companies on the green light to scam families,” said Warren.
Last week, Warren called Trump to work with the office to protect Americans from destroying it, the practice of banks closing customer accounts because they believe they present financial, legal or reputation risks for banks.
“I know that the Consumer Bureau of Financial Protection is a favorite whipping boy of the Republicans of this committee, but the CFPB is the main agency of our government which is actively working to stop the unfair decomposition,” she said during of an audience on the Senate Banking, Housing and Urban Affairs Senate.
On Friday, president of President Donald Trump said that President Donald Trump had made him the CFPB. Asset licensee The former director of the office, Rohit Chopra, on February 1. Vought was an architect of the 2025 project, a political plan for Trump’s White House that Trump tried to disavow during last year’s campaign.
Under Chopra, the CFPB approved the rules to cap the discourse costs by banks, limit unwanted costs and has proposed restrictions on data brokers selling personal information such as social security numbers.