Big payday lenders have been hurting American consumers for far too long. Now, the Community Financial Services Association of America (CFSA), a trade group that represents the payday industry, is challenging the constitutionality of the Consumer Financial Protection Bureau (CFPB), the agency created to defend consumers against these predatory practices.
Here is what you need to know about the CFSA:
Some of the worst payday offenders serve on the CFSA board.
The CFSA’s board consists of 13 executives from predatory payday lenders, according to a 2021 form 990, and has extensive ties to Republican politicians and lawmakers. For example, some of the worst offenders are Ian Mackechnie, Head of Amscot Financial, who was convicted of insurance fraud and banned from selling insurance in Florida, and Kip Cashmore, head of USA Cash Services, who was associated with fraud and bribed disgraced Utah AG to benefit his payday lending company.
CFSA has extensive ties to Republican lawmakers, who have been trying to kill the CFPB.
According to FEC records, the CFSA has contributed a combined $96,000 to Republican members on the House Financial Services Committee (HFSC) and Senate Banking Committee. The members signed a July 2023 amicus brief supporting the CFSA’s challenge against the CFPB. Among the top recipients of these contributions are staunch anti-CFPB Rep. Blaine Luetkemeyer (R-MO), current HFSC Chairman Patrick McHenry (R-NC), and Senate Banking Ranking Member Tim Scott (R-SC), among others.
- During the Trump presidency, the trade organization hosted at least two of its annual conferences at the Trump National Doral in Miami, Florida. Jones Day, a law firm with extensive ties to conservative judges and groups, is representing the CFSA in its case against the CFPB. The association spent 78% of its total revenue on legal fees to Jones Day that fiscal year, according to the CFSA’s 2021 Form 990. Noel J. Francisco, Counsel of Record for the case, is a former clerk for the late Justice Antonin Scalia and President Trump’s Solicitor General from 2017 to 2020. Firm partner Christian Vergonis is also a commentator for the Federalist Society.
- Purpose Financial, headed by CFSA President Jessica Rustin, has paid Mindset Advocacy over $2.4 million since 2012 to lobby the federal government on issues pertaining to “Dodd-Frank implementation” and “rate cap legislation.” Two lobbyists at Mindset also have extensive careers as staffers on the Hill working for Representatives Patrick McHenry (R-NC) and Blaine Luetkemeyer (R-MO). Mindset senior director Charlie Schreiber, who worked on the House Financial Services Committee until August 2021, has given HFSC Republicans who signed a July 2023 amicus brief $7,500, including $1,750 to Chairman McHenry. Partner Chris Brown, who worked in numerous positions for Rep. Luetkemeyer and the HFSC under then-ranking Member McHenry, has contributed a staggering $34,800 to HFSC members, including $7,500 to Chair McHenry.
CFSA entities have paid over $200 million in fines brought by Regulators.
- In January 2019, Enova was fined $3.2 million by the Bureau for debiting consumer bank accounts without their authorization. In November 2013, Cash America International, Enova’s parent company at the time, was fined $5 million by the CFPB and forced to pay $14 million in refunds for “violat[ing] the Military Lending Act by illegally overcharging servicemembers and their families.“
- In April 2020, PROG subsidiary Progressive Leasing paid $175 million to settle a Federal Trade Commission lawsuit alleging the lender “frequently” misled consumers by charging consumers twice the advertised ticket price for payments on rent-to-own items. Then-FTC director Kelly Slaughter said, however, “the settlement did not go far enough,” as consumers ultimately paid “more than $1 billion in extra fees and charges.”
- In August 2011, QC Holdings agreed to pay $1.9 million to settle a class action lawsuit alleging the company violated Missouri law by “charging exorbitant rates” and “renewing payday loans too many times.”
An Accountable.US review of payday lenders on the CFSA board shows a plethora of reasons these entities are determined to gut the CFPB's independent funding mechanism. Many have been fined or settled lawsuits with federal regulators and have a history of contributing to Republican lawmakers who have sided with industry in its attack against the Bureau. CFSA board member companies, and their affiliated subsidiaries and parent companies, have paid over $204 million in fines and restitution to federal and state regulators, while paying at least $3.4 million in settlements from class action lawsuits against them.