In 2013, ProPublica published an investigation of the subprime lender World Finance. World was charging annual interest rates that could exceed 200 percent, often trapping customers in cycles of debt by enticing them to renew the loans over and over. In states where laws barred such high rates, the installment lender loaded many loans with nearly useless insurance products that bloated the cost. The company boasted over 800,000 customers, part of an installment loan industry that claimed to loan to millions.
The following year, World disclosed that it was under investigation by the Consumer Financial Protection Bureau. The CFPB, the brainchild of Sen. Elizabeth Warren, D-Mass., was created by the 2010 Dodd-Frank financial reform bill, and under the leadership of Richard Cordray, the agency took action against credit card lenders, mortgage servicers, payday lenders and others for unfair practices against consumers.
But after Cordray left last November, President Donald Trump installed Office of Management and Budget head Mick Mulvaney as acting director. To say that Mulvaney has been a critic of the CFPB is a vast understatement. In a 2014 interview given when he was still a Republican congressman, Mulvaney said of the CFPB, “some of us would like to get rid of it” and called it “a joke ... in a sick, sad kind of way.”
[For more on this story by Paul Kiel, go to https://www.propublica.org/art...-of-high-cost-lender]
Comments (0)