WASHINGTON, D.C.— Brady Williams, Legal Counsel, issued the following statement on the deadline for submitting comments on the CFPB’s Advanced Notice of Proposed Rulemaking on the Fair Credit Reporting Act; Identity Theft and Coerced Debt. The proposal is now on hold because the Trump administration shut down all rulemaking at the CFPB:
“Last year, in a major step toward protecting survivors of financial abuse, the Consumer Financial Protection Bureau (CFPB) launched a rulemaking process to address the devastating impact of inaccurate credit reporting on victims of domestic violence, elder abuse, and other forms of economic exploitation. These victims have suffered twice, first in being the targets of abuse and then again in having their credit and financial security destroyed.
“For many survivors, financial abuse—often in the form of coerced debt—becomes an invisible chain, keeping them trapped in dangerous relationships. Abusers frequently force victims to take on debt through threats, manipulation, or physical violence, leaving them burdened with ruined credit and insurmountable financial obstacles. Nearly three-quarters of domestic violence survivors report that coerced debt contributed to their inability to leave an abusive relationship. The impact is especially severe for women of color, who face disproportionately high rates of financial abuse and nearly double the average debt burden.
“The Bureau’s announcement thus signaled a critical opportunity to expand identity theft protections and prevent credit reporting from being weaponized against survivors. For example, to address these abuses, the CFPB is considering expanding the definition of “identity theft” to provide protections for those with coerced debt and to enable those victims to block adverse credit information based on that debt.
“Unfortunately, the Trump administration has turned its back on these victims. This initiative is now on hold because the Trump administration has shut down virtually the entire CFPB, including all rulemaking activity and all enforcement cases. That means, for now at least, no more safeguards and no more accountability for the financial predators, from brand-name banks to payday lenders who prey on hardworking Americans every day. The administration took this profoundly misguided action notwithstanding a mountain of evidence showing that the CFPB has served as one of the most effective consumer protection agencies in the history of financial regulation. Through its rules and enforcement actions, the CFPB has shielded consumers from all sorts of predatory and abusive financial practices and recovered over $20 billion dollars for the benefit of victims.
“Today marks the deadline for the public to submit comments on the proposal, but that date is now essentially meaningless. Instead of submitting comments on a valuable consumer protection proposal, we highlight this example of the real and ongoing damage being done by the shuttering of the CFPB.”
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