WASHINGTON D.C. — The U.S. Supreme Court is currently deciding the fate of the Consumer Financial Protection Bureau’s independence following a lawsuit brought by the predatory payday loan industry with an ax to grind against the agency that stands up for consumers and is not for sale to corporations. Ahead of oral arguments in the case, 132 congressional Republicans filed an amicus brief in July endorsing the top payday trade group Community Financial Services Association of America (CFSA)’s meritless lawsuit challenging the constitutionality of the CFPB’s funding structure. Following the recent FEC deadline for political contributions in the third quarter of 2023, a new analysis from government watchdog Accountable.US found the payday loan industry rewarded amicus brief signers with at least $82,500 in campaign checks in the weeks and months after signing the brief.
The payday loan industry is hedging its bets in Congress in its long-time effort to defund and defund the CFPB as their case was met with ‘broad skepticism’ in the Supreme Court, especially as the CFPB’s independent funding structure mirrors funding mechanisms used since the republic’s founding – crushing claims the agency is not constitutional.
Predatory lenders are greasing the palms of Republicans in Congress who endorsed their legal scheme for gutting the nation’s top consumer advocate. It’s all part of the plan for payday lenders notorious for trapping families in debt with triple-digit interest rates that hate that the Consumer Financial Protection Bureau is constitutional and can’t be bought and paid for. Predatory lenders are counting on those who do the bidding of corporations in Congress to finish the job of rolling back consumer protections for millions of Americans. Since the CFPB’s inception, the financial industry and their lackeys in Congress have tried to shut it down all because it’s an agency that puts consumers before corporations. That’s why industries that price-gouge everyday Americans have had it out for the CFPB since day one.”
Accountable.US’ Liz Zelnick, the group behind the Defend American Consumers project.
Among the key findings in Accountable.US’ report, Rep. Bill Posey (R-FL-8) received $7,500 from the MacKechnie Family, owners of payday company Amscot Financial, less than two weeks after signing onto the amicus brief. Founder Ian MacKechnie has a shady business history in Florida, receiving a life-time ban selling insurance after his company, Amscot Insurance, pled guilty to racketeering charges in August 1998. As Accountable.US has documented, CFSA is packed with people like MacKechnie with criminal and sleazy pasts.
Another notable donation: Sen. Roger Wicker (R-MS) got $6,600 from CFSA board member Mike Hodges, the chairman and founder of payday lender Advance Financial. Mr. Hodges is the same payday executive infamously caught on tape during an industry webinar openly bragging that his contributions lead to regulatory rollbacks.
The payday loan industry strategy is clear: if the Supreme Court rules against the CFPB’s independent funding structure, the industry is already buttering up Members to defund the agency during appropriations. If SCOTUS rules in favor of the CFPB and its strong argument that its funding structure mirrors funding mechanisms used since the republic’s founding, industry will call in favors and turn up the heat on Congress to act on active bills to weaken the CFPB, which the Patrick McHenry-led House Financial Services Committee has advanced in recent months.