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Consumer Financial Protection Bureau Quietly Wins a Battle With McConnell
Congressional Republicans have fought unrelentingly for years to weaken the Consumer Financial Protection Bureau, put into place under the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. The purpose of the CFPB is to promote fairness and transparency for mortgages, credit cards, and other consumer financial products and services. The CFPB was created to provide a single point of accountability for enforcing federal consumer financial laws and protecting consumers in the financial marketplace.
On March 30, Sen. David Perdue (R-Ga.) filed a discharge petition to expedite his bill repealing the Consumer Financial Protection Bureau’s (CFPB) “prepaid rule” that protects from hidden fees and other predatory practices the roughly 23 million Americans who use prepaid cards for everything from hourly wages to Social Security benefits. While repealing these important prepaid card protections would hurt nearly half a million of Perdue’s own constituents, repeal would greatly benefit NetSpend--one of Perdue’s major donors--to the tune of $80 million.
A relentless public campaign to share Perdue's conflict led to him barely being able to defend his own legislation. Groups like Allied Progress, an advocacy organization that uses research and creative campaigns to stand up to Wall Street, educated constituents in numerous states via grassroots action to encourage Smart Dissent. It works.
...support for the bill fizzled despite having McConnell’s backing; and the legislative window for the Senate to repeal the prepaid rule with a simple majority closed for good last night. In the end, Perdue and McConnell’s failure is a huge victory for the millions of Americans who use prepaid cards.
By the way, NetSpend is the worst.
...just one day after Perdue filed his McConnell-endorsed discharge petition to gut prepaid card protections, NetSpend agreed to pay $53 million to settle Federal Trade Commission (FTC) charges that it had defrauded customers.
Despite NetSpend’s opposition, other companies and industry trade groups endorsed the Consumer Bureau’s prepaid card rule. Green Dot, the company that invented the prepaid card and is still the industry’s largest provider, backs the protections.