Expected Changes at the CFPB Under the Incoming Trump Administration

Posted by Gracie Nelson on November 7, 2024

With the Trump Administration set to take office soon, we can expect a significant shift in the direction of the Consumer Financial Protection Bureau (CFPB). One of the first changes will likely be the replacement of the current CFPB Director Rohit Chopra. Chopra’s term is not set to end until the end of 2026; however, a Supreme Court Decision allows the President to replace the CFPB Director. GoWest expects the President to appoint an interim Director in January and then follow up with a nomination for a permanent replacement which will need Senate confirmation. 

The new leadership is expected to delay or reassess many of the rules implemented under Chopra. This shift mirrors what happened in 2018 when Trump appointed Mick Mulvaney as acting director of the CFPB following the resignation of Obama appointee Richard Cordray. Under Mulvaney, the CFPB paused the implementation of a rule restricting payday lending practices, citing the need for further review. As Bloomberg Intelligence analyst Elliott Stein notes, it is “an awkward position” for the CFPB to continue defending rules it may no longer support, and a similar approach may be taken now, with numerous consumer protection rules facing delays or reassessment. 

Regulations in Development that are Likely to Be Paused:

• Mortgage Servicing Rules
• Financial Data Transparency Act
• Regulation AA (UDAAP)
• Overdraft Lending for Very Large Financial Institutions
• Nonsufficient Funds Fees for Instantaneous Transactions
• Collection of Demographic Data on Small Business Borrowers

Finalized Rules with Potential Delays or Rollback:

• Caps on Credit Card Late Fees
• Restrictions on Medical Debt Collection
• Extension of Credit Card Protections to Buy Now, Pay Later Products
• Fair Credit Reporting Act Rulemaking

What About Open Banking? 

Open Banking is likely to continue progressing despite potential changes in leadership, as it has garnered bipartisan support for enhancing consumer control over financial data. Congressman Patrick McHenry, Chairman of the House Financial Services Committee, has described Open Banking as a “step forward for Americans in financial data privacy.” This support suggests that Open Banking may move forward with relatively limited opposition. 

It’s important to note that GoWest will engage with the incoming Administration, advocating for credit unions and exploring options to help alleviate pressures faced by the industry.  

Looking Ahead 

As the regulatory landscape shifts under the incoming administration, GoWest will continue to closely monitor developments at the CFPB and actively engage with key stakeholders to support credit unions. Our goal is to ensure that credit unions are well-positioned as the regulatory environment adjusts to new priorities and legislative dynamics.  

If you have any questions or concerns about what the next few months will look like, or regarding a specific regulation mentioned above, please reach out to John Trull at [email protected] and Gracie Nelson at [email protected]. 

Posted in Advocacy on the Move, Regulatory Advocacy.