• DYE CULIK PC | Consumer Protection Division

What is the Consumer Financial Protection Bureau (CFPB) and How does it Benefit Consumers?

The Consumer Financial Protection Bureau (CFPB) is a federal regulatory agency that oversees financial products and services offered to consumers in the United States. Since its creation in 2010, the CFPB aims to prevent financial harm to consumers, empower them through education on different financial topics, and provide data-driven insights into the market.

The CFPB is charged with making credit products and other consumer financial products safer and easier to understand and use. They do this by making sure prices are clear up front and risks are easy to see. The agency has three universal goals: to empower consumers, enforce regulatory law, and educate companies and consumers.


How the Consumer Financial Protection Bureau Empowers Consumers

The CFPB creates tools such as listening to and investigating consumer complaints when people feel they have been treated unfairly by a financial service company. According to Forbes, 97% of consumers receive a timely response from when the CFPB contacts the financial services company. The agency also provides a public database where consumers may search other complaints that have been issued to a specific company.

In July of 2020, the Consumer Financial Protection Bureau released an online tool to help college students determine how to pay for college. The agency set up a web tool called “Your Financial Path to Graduation” Bureau Director Kathleen L. Kraninger stated it is an “innovative tool to provide students and their families with simplified and effective disclosures on the cost of college and the cost of their financing options over the life of the loan.” This tool empowers students to turn their financial aid assistance into tangible plans that will take step them through the terms of the financial agreement while tracking uncovered costs.

Another way the Consumer Financial Protection Bureau empowers consumers is through their open source tool, eRegulation. The CFPB recognizes that understanding federal regulations is difficult, so they sought to create a tool that would benefit the public and the government. With eRegulation, consumers may navigate and read the different federal regulations with introductory paragraphs and background summaries to obtain more clarity on the issue. The tool is easy to search, has key terms defined throughout, includes certain sections of the Federal Register preambles, and gives consumers the ability to see previous, current, and future versions.

How the Consumer Financial Protection Bureau Enforces Law

After the market collapsed in 2008, the CFPB was created to ensure an event such as the housing bubble does not happen again. The regulatory agency enforces laws against unfair, abusive, deceptive, and predatory acts by financial services companies. These types of acts may include predatory lending, excessive fees, and financial fraud. After catching these illegal acts, the CFPB can return the money to harmed consumers.

Not only does the CFPB enforce federal consumer financial laws, they also implement them. This process begins with research and public input through consumer and industry roundtables and field hearings. After carefully assessing the benefits and costs as well as the economic impact, they will add the law to their regulatory agenda. You can browse all final rules here.

How the Consumer Financial Protection Bureau Educates Consumers

The CFPB strongly encourages financial education and capability whether the consumer is a child, college student, working adult, or in retirement. The agency has provided resources for educators to teach K-12 financial education and capability, as well as effective practices for adult financial educators. A division of the agency, known as the Consumer Education and External Affairs, develops approaches to engagement with consumers, policymakers, and those in academia. This division aims to build a framework grounded in financial well-being through expert opinion, consumer experiences, and existing literature on financial topics.

The Consumer Financial Protection Bureau serves as an advocate for consumers within the realm of financial services. The CFPB enables the market to run more effectively while regulating and creating a fairer environment.

Dye Culik PC is a consumer-protection firm with offices in Charlotte, North Carolina and Boston, Massachusetts. Our attorneys handle consumer financial protection issues for consumers and small businesses, including defending debt collection lawsuits, stopping harassment and unfair practices of debt collectors, and other issues related to debt collection. If you are having an issue with a debt collector, credit card company, or other financial services companies, contact us to see how we can help.