If the Consumer Financial Protection Bureau (CFPB) is making its last stand, the controversial bureau is going down fighting.
The CFPB was formed in 2011 to implement and enforce consumer financial laws. It was tasked with protecting consumers from “unfair, deceptive or abusive practices.” In recent years, the bureau has sued many of the biggest banks and financial institutions in the country, including JP Morgan Chase, Bank of America and Wells Fargo. It has also taken action against some of the largest mortgage companies in the country, including Rocket Mortgage; Vanderbilt Mortgage & Finance, a division of Berkshire Hathaway’s Clayton Homes; and most recently Draper & Kramer Mortgage.
The CFPB maintains that the Downers Grove, Illinois,-based mortgage company allegedly used discriminatory mortgage lending practices that discouraged homebuyers from applying to Draper for homes in majority-Black and Hispanic neighborhoods in the Chicago and Boston areas.
Draper allegedly located all of its offices in majority-white neighborhoods and concentrated its marketing in majority-white neighborhoods. The company also avoided marketing to majority-Black and Hispanic areas. These actions resulted in “disproportionately low numbers of mortgage loan applications and mortgage loan originations from majority-Black and Hispanic neighborhoods in Chicago and Boston compared to other lenders.”
Because of these legal cases, the bureau has earned the ire of industries and elected officials. The CFPB has long been a punching bag for Republicans and conservatives. The conservative thinktank The Heritage Foundation has been a leading voice in the movement to eliminate the bureau and President Donald Trump had said during his first term that he would work to get rid of the bureau.
Certainly, members of the U.S. technology elite want to see the CFPB go down in flames. In November, Elon Musk, a close adviser to President Donald Trump and the director of the new Department of Government Efficiency, wrote on his X platform that he would like to “delete” the bureau. “There are too many duplicative regulatory agencies,” he wrote.
Marc Andreessen, another tech billionaire who is a friend of Musk’s and an influential investor, said this fall on the Joe Rogan Experience podcast, that the CFPB “terrorizes financial institutions” and prevents new companies from competing with the big banks.
Defenders of the bureau tell a different story, saying it has been the cop on the financial beat for consumers, defending their interests and fining bad actors that have hurt customers through a variety of deceptive practices. In the process, the CFPB has returned an estimated $17.5 billion to consumers.
One of the leading targets of scorn at the bureau has been Director Rohit Chopra, who took over the bureau in 2021 and has been accused of running the CFPB with a lack of transparency and accountability. U.S. Sen. Pat Toomey (R-Pennsylvania) and retired U.S. Sen. Richard Shelby (R-Alabama) accused Chopra in 2022 of running a “lawless and unaccountable agency.” They wrote that he had “unchecked power,” and was carrying out a “radical and highly politicized agenda unbound by statutory limits.”
Through all the attacks, Chopra has survived. While other appointees have resigned their posts, Chopra hasn’t. And as of Friday, he continued to run the agency and sue the nation’s financial institutions for alleged wrongdoing, including Draper & Kramer Mortgage. The bureau is requesting that the courts ban Draper & Kramer from engaging in residential mortgage lending activities for five years and requiring it pay a $1.5 million civil money penalty into the CFPB’s victims relief fund.
