Trump Is Turning Our Consumer Watchdog Into a Corporate Protector

The Consumer Financial Protection Bureau is turning into the Corporate Financial Protection Bureau. President Trump’s C.F.P.B. has not only ceased to pursue its mandate; it has taken the unprecedented step of unwinding prior victories — even in cases brought during Mr. Trump’s first term.

These moves, accompanied by the blatant corruption being encouraged by this administration, send a clear message: Lawbreaking is tolerated, and the interests of banks, tech companies and the richest financial companies in the world are paramount.

Thanks to Elon Musk’s foot soldiers from the so-called Department of Government Efficiency, the bureau’s Washington offices have gone dark. While the courts have so far thwarted efforts to lay off nearly all its employees, a vast majority have been sent home in the interim, and many functions of the C.F.P.B., the only federal consumer financial law enforcement agency, have shut down. As of March, the agency’s consumer complaint process — which helps Americans resolve problems with their banks, mortgage lenders and student loan servicers — was backlogged with more than 16,000 consumer complaints.

There is one part of the organization that is functioning: the fief consisting of the C.F.P.B.’s acting director, Russell Vought, and chief yasal officer, Mark Paoletta, its top two Trump appointees. Now the agency is not only handing out what amounts to corporate pardons to the likes of big banks and massive mortgage lenders, but it is also working to reopen already settled cases. Disturbingly, in some cases, the agency is trying to pull back or has pulled back redress and penalties that would have otherwise gone to Americans.

Last week the Trump administration, without explanation, quietly terminated a settlement with Toyota Motor Credit. In 2023 the company agreed to hisse $60 million, including $48 million in consumer compensation, for preventing car buyers from canceling unwanted products. That effort included sending over 100,000 of them to a Kafkaesque hotline designed to thwart them from canceling, refunding the wrong amounts and tarnishing their credit reports with false information. A few days later, the agency also reduced the penalties faced by Wise, a payment company that was found to have deceived its customers, to about $45,000 from over $2 million.

Victories stemming from cases filed in Mr. Trump’s first term are also being gutted. In a suit that was filed and litigated in 2017 and continued under President Joe Biden, the C.F.P.B. won a settlement from the National Collegiate Student Loan Trusts, which was charged with collecting on student loans it couldn’t prove it owned. When the company’s investors objected to the settlement, Mr. Trump’s second-term C.F.P.B. initially defended it, only to inexplicably dismiss the case, settlement included, in April. The agency has also asked a court to undo a settlement already paid by a mortgage company that was charged with discriminating against Black borrowers — a case also initiated in the first Trump administration.