Trump’s Move To Gut Financial Protection Agency Could Cost Consumers $15 Billion A Year, Say Advocacy Groups
President Donald Trump’s bid to dismantle the Consumer Financial Protection Bureau has shifted at least $18 billion in costs onto consumers through higher bank fees and canceled restitution, two advocacy groups said Tuesday.
What Happened: The Student Borrower Protection Center and the Consumer Federation of America calculated the hit by tallying policies the administration halted since Treasury Secretary Scott Bessent froze most CFPB activity in February.
In a statement shared with Reuters, they say scrapping Obama and Biden-era plans to cap credit-card late fees at $8 and overdraft charges at $5 will alone cost consumers about $15 billion a year.
The CFPB has also dropped or settled 22 enforcement cases inherited from the prior administration, including actions against JPMorgan Chase (NYSE:JPM), Bank of America (NYSE:BAC), Wells Fargo (NYSE:WFC) and Capital One (NYSE:COF), covering another $3 billion in alleged harm.
Earlier this month, CFPB lawyers quietly voided redress agreements with Toyota’s lending arm and a major payments processor, erasing roughly $50 million owed to borrowers, the groups said.
Why It Matters: The watchdog groups urged Congress to restore the fee caps and reopen canceled cases, warning that each month of inaction transfers billions from families to financial giants.
Trump has previously called the CFPB an “ultra-left” agency and boasted he “shut it down after bankers were almost crying,” according to a February interview. Administration allies argue the bureau overreached and stifled free enterprise. According to Reuters, Senate Republicans recently tried to defund it in a sweeping tax bill before parliamentarians stripped the provision for violating budget rules.
Consumer advocates counter that households are absorbing higher costs just as real wages lag inflation and the Fed holds rates near two-decade highs. Meanwhile, analysts reveal that the regulatory freeze could boost lender profits and certain financial-sector ETFs as oversight weakens.
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