Reining in Wall Street

STANDING UP AGAINST THE BIG BANKS AND WALL STREET—For more than 20 years, Consumer Program Director Ed Mierzwinski has helped us stand up against big banks and credit card companies.

A PRO-CONSUMER FISCAL FUTURE

Consumers shouldn't have to worry that their financial institutions are ripping them off, or using tricks and schemes to squeeze money out of them.

Yet for years, federal bank regulators ignored numerous warnings of increasingly predatory mortgage practices, credit card tricks, and unfair overdraft policies used by the big Wall Street banks. They also ignored warnings of risky securities being packaged and sold to investors. In the wake of the resulting financial crisis, U.S. PIRG fought for and successfully urged passage of a strong 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act.

Since winning federal Wall Street reform, we've worked to defend those reforms from the industry's attempts to defang, defund or delay them. In particular, since it began work in July 2011, we've had to defend the Consumer Financial Protection Bureau (CFPB), the first federal financial agency with just one job: protecting consumers. However, it took another two-year fight against the opponents of the CFPB to convince the Senate to confirm Bureau's director, Richard Cordray, to a full five-year term. The Senate finally confirmed Cordray in July 2012, eliminating any uncertainty over the CFPB's authority over credit bureaus, payday lenders and other non-bank firms.

The CFPB - in many ways the centerpiece of the broader 2010 Wall Street reforms - has already succeeded in protecting consumers, from students and soldiers to seniors and homeowners. Among the CFPB's successes have been its new regulation of the mortgage markets, its creation of a publicly-available consumer complaint database, and its investigations of the big credit bureaus. The CFPB has also made banks and credit card companies return nearly half a billion dollars to consumers who were treated unfairly.

Yet consumers, taxpayers and investors still face big risks in the financial marketplace. Big banks are allowed to make risky bets with our money, many financial institutions are still finding ways to unfairly squeeze money out of their customers, and financial industry practices still pose risks to the financial system. So in addition to defending the CFPB, we are working to protect investors, taxpayers and the financial system itself:

  • We're supporting a requirement called the Volcker Rule which would prevent big banks from using their “own” money, which includes depositor funds, to place risky bets.
  • We're urging the Commodity Futures Trading Commission not to allow the big banks to hide their reckless financial bets offshore the way that AIG and JP Morgan's London Whale did.
  • We're backing Securities and Exchange Commission rules to require that all public companies, including banks, publish the ratio of compensation between their CEO and their middle-level employees.

In short, we're building a financial regulatory system that guarantees that consumers and taxpayers are protected from predatory practices. And we're fighting to give consumers a seat at the table when it comes to oversight of the nation's financial system.

Issue updates

News Release | U.S. PIRG | Financial Reform

Senate Moves Toward Confirmation of CFPB Director Cordray

Today’s expected confirmation of Richard Cordray to head the CFPB for a full term is good news for consumers, and for firms that want to play fair in the financial marketplace.

> Keep Reading
Blog Post | Financial Reform

Banks, Not CFPB, Spy On Consumers | Ed Mierzwinski

As a Tuesday, July 16th Senate showdown vote on the confirmation of Richard Cordray to direct the CFPB approaches, consumer protection opponents continue to make stuff up, such as their latest false claim that its use of data equates it with the NSA. Actually, it's the banks, not the CFPB, spying on consumers.

> Keep Reading
Blog Post | Financial Reform

New book on the fight for the CFPB | Ed Mierzwinski

Two academics have published a book chronicling the PIRG-backed fight to establish the Consumer Financial Protection Bureau (CFPB) as a centerpiece of the Wall Street reforms enacted in 2010. Their history of the largely successful efforts of the coalition Americans for Financial Reform and its work alongside Professor Elizabeth Warren has lessons for all advocates seeking to fight city hall or evil empires.

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News Release | U.S. PIRG | Consumer Protection, Financial Reform

CFPB Ends Kickbacks by Mortgage Insurers

U.S. PIRG applauds CFPB’s enforcement action, including over $15 million in total penalties, against four mortgage insurers to end the practice of giving kickbacks to mortgage companies to get their business.

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Blog Post | Financial Reform

Do better Facebook friends mean a better credit score? | Ed Mierzwinski

"Big Data" has created a new front in the war on privacy. Should a prospective employer be able to "friend" you or use your Facebook password to vet you?  When, if ever, should colleges, employers and lenders be able to look at your Facebook or other social network pages to see if your friends make you a better bet to enroll, hire or grant a loan to than someone with loser friends?

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News Release | U.S. PIRG | Financial Reform

U.S. PIRG Ratchets Up Support for Confirmation of Rich Cordray to Head CFPB

With a Senate vote on confirmation of former Ohio Attorney General Rich Cordray to head the new Consumer Financial Protection Bureau expected tomorrow, U.S. PIRG ratcheted up its efforts to urge Senators to support confirmation. The group announced that it is urging its members in every state to contact Senators and running radio ads in several states.

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News Release | U.S. PIRG | Financial Reform

Changes Gut Consumer Protections, Protect Wall Street

The House Financial Services Committee simultaneously approved an industry-friendly rollback of consumer financial and product safety protections. The approved bill eliminates the independence of the new Consumer Financial Protection Bureau (CFPB) while also preventing the Consumer Product Safety Commission's (CPSC) new public information database from informing the public about product hazards.

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News Release | U.S. PIRG Education Fund | Financial Reform

OCC Again Chooses Interests of Banks Over Consumers and States

A broad coalition of more than 250 consumer advocacy and civil rights groups are protesting yesterday’s announcement by the Office of the Comptroller of the Currency (OCC) that it will largely ignore a key mandate of the Dodd-Frank Wall Street Reform Act passed by Congress last year in response to the financial scandals that brought on the nation’s worst economic downturn since the Great Depression. Instead, the OCC will continue to give national banks a blank check to violate state rules against unfair and predatory practices.

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News Release | U.S. PIRG | Financial Reform

Two Years After Passing the Credit CARD Act, Congress Steps Up Attacks on Consumer Cop Designed to Enforce It

The Credit CARD Act of 2009 has eliminated numerous credit card tricks and traps without causing skyrocketing interest rates or any of the other horrible side-effects that the banks once warned about.  Now the banks and their Congressional allies are seeking to eliminate the CFPB, the new consumer cop created to enforce the CARD Act and protect consumers from other tricks of the trade, like unfair mortgage and overdraft practices.

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News Release | U.S. PIRG | Financial Reform

Congress Should Reject Attempts to Put "Knife in the Ribs" of CFPB

U.S. PIRG and other members of Americans for Financial Reform are urging the House of Representatives to reject three proposed bills designed to defang and delay the new Consumer Financial Protection Bureau (CFPB).

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Blog Post | Financial Reform

Financial follies update: Discover Card pays deceptive marketing penalty | Ed Mierzwinski

Discover Card has paid a $14 million civil penalty to the CFPB and FDIC, plus refunded over $200 million to ripped-off consumers, in the latest case involving useless, junk credit insurance and credit monitoring add-ons that consumers didn't buy, but pay for, to credit card bills. Read more for that and other weekend financial follies.

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Blog Post | Financial Reform

CFPB hearing today in House, expect more attacks | Ed Mierzwinski

As Richard Cordray, director of the Consumer Financial Protection Bureau, prepares to testify this morning in the House, committee leaders have released statements showing they're not so much interested in oversight. They;ve already made up their minds that an agency with only one job, protecting consumers, is a bad idea.

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Blog Post | Financial Reform

It happened 4 years ago this weekend, and Congress has already forgotten | Ed Mierzwinski

Four years ago, on September 14-15, 2008, the Lehman Brothers investment bank declared bankruptcy while Bank of America acquired another foundering investment bank, Merrill Lynch -- major events that froze the financial markets and led in a few days to a $700 billion bailout of the financial system. Just four years later, some in the Congress have forgotten that real people and the economy are still suffering from the financial collapse, as it steps up Wall Street-backed efforts to prevent regulators from protecting the public.

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Blog Post | Financial Reform

Bank lobby launches dark money group to kill reform and other Friday Follies | Ed Mierzwinski

(UPDATED) The American Bankers Association's latest effort to kill financial reform is to raise millions of dollars through a new dark money group (like a secret SuperPAC) disguised as a social welfare organization but designed to elect Senators who agree with their Bizarro-World narrative that the financial collapse of 2008 was not their fault.  Meanwhile, read more Friday Financial Follies, because in Washington, we don't have to make this stuff up.

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Blog Post | Financial Reform

SEC mostly ignores us, proposal weakens investor protections | Ed Mierzwinski

Yesterday, the Securities and Exchange Commission (SEC) issued a proposed rule implementing the controversial JOBS Act that fails to protect small investors from a likely onslaught of sales pitches online and on the phone -- including from private equity and hedge funds. Positively, it's only a proposed rule, at least nominally subject to amendment, not an interim final rule.

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