Washington D.C. – This week four House Financial Services Committee Republicans penned a hostile missive to the Consumer Financial Protection Bureau criticizing a lawsuit the agency filed in January along with the New York Attorney General against a notorious predatory auto lender, Credit Acceptance Corporation (CAC). The complaint accused CAC of “tricking its customers into high-cost loans on used cars” at a time when defaults on subprime auto loans are rising at “a record rate.” The lender previously settled a lawsuit for $27 million with the Massachusetts Attorney General for “lur[ing] [consumers] into high-cost loans” and has faced thousands of CFPB consumer complaints.
Despite the company’s clear history of consumer abuse, industry groups and Republicans in Congress have come to its defense in seemingly coordinated fashion. The March 21 letter to the CFPB from House Republicans opposing the lawsuit against CAC came on the very same day the U.S. Chamber of Commerce filed an amicus brief along with the American Financial Services Association (AFSA) and Consumer Bankers Association (CBA) in support of CAC in the lawsuit. As of May 2022, CAC was also a member of the AFSA.
An Accountable.US review of campaign finance records shows Republican lawmakers going after the CFPB – including Reps. Andy Barr (R-KY), Bill Huizenga (R-MI), Andrew Garbarino (R-NY), and Mike Lawler (R-NY) — have received $216,500 in career contributions from these three industry trade groups opposed to this lawsuit.
Even a notorious predatory lender can count on high-profile support from certain Republicans in Congress when enough industry money has changed hands. Industry groups gave these lawmakers at least 200,000 reasons to rush to the aid of a repeat-offender now accused of skirting state usury laws and pushing high-interest loans to consumers they knew could not pay them back in time. These Republicans are more worried more about the bottom line of predatory lenders than the growing number of vulnerable families caught up in the high-cost loan debt trap.
House Republicans often act as a megaphone for industry grievances against the CFPB and are vocal about their desire to gut the agency that has returned billions of ill-gotten dollars to wronged consumers. But they have been oddly quiet about the federal appeals court ruling today that the CFPB’s funding structure is 100% constitutional."