By Lindsay Press
Leading a group of 23 attorneys general, Attorney General Letitia James filed a brief in the U.S. District Court in Maryland on February 20 to prevent the Consumer Financial Protection Bureau (CFPB) from being shut down by President Donald J. Trump and the Elon Musk-led Department of Government Efficiency (DOGE).
The CFPB is a private agency that oversees big banks, lenders, credit card companies, and mortgage servicers to ensure that companies are following federal consumer protection laws. James cited the CFPB as a beneficial program by helping homeowners facing foreclosure to stay in their homes, stopping banks from charging unnecessary fees, and giving back over $20 billion to consumers nationwide.
Formed in 2011 after the Great Recession to enforce federal consumer protection laws, the CFPB has worked alongside state attorneys general to handle consumer issues connected to banking, student loan services, mortgage servicers, auto lending, and other consumer financial matters. The CFPB and attorneys general have also collaborated to put an end to deceptive, unfair, and abusive conduct by companies. James said, after Trump’s decision, the nation’s biggest banks will no longer be closely watched by any federal regulator.
So far, 74 lawsuits have been filed against the Trump administration, but that did not stop them from telling the CFPB on February 9 to end all of its ongoing work and not start any new investigations.
“Eliminating the CFPB will hurt everyday people and benefit billionaires like Elon Musk and his friends,” James said. “The CFPB has put billions of dollars back in the pockets of Americans by going after predatory lenders, deceptive companies, and slashing junk fees. The only reason to get rid of this watchdog agency is to protect bad actors. Working families need the CFPB, especially as rising prices are making it hard to make ends meet and put food on the table. My office is leading this coalition to help protect the agency that has protected all of us.”
The attorneys general are warning the public that shutting down the CFPB may lead to financial institutions loosening their regulatory compliance, which, in the past, has led to a fiscal crisis. “Indeed, these harms have already begun,” James said. “In the absence of a functioning CFPB, States have suddenly lost the CFPB’s significant expertise and resources that can be invaluable in online matters that protect their residents. States’ access to the benefits provided by the CFPB has effectively ceased.”
Long Island Life & Politics has reached out to the Trump administration, but did not hear back as of press time.