An advocacy group made up of bank workers and community and consumer advocates has slammed the acting director of the Consumer Financial Protection Bureau for cutting back on the agency’s regulatory enforcement.
The CFPB has not taken a single enforcement action since Acting Director Mick Mulvaney took the helm, the Committee for Better Banks said. The committee also collected formal comments and concerns submitted to the agency by bank workers.
Mulvaney has repeatedly said that the CFPB needs sweeping checks on its authority. Bank employees called for stronger enforcement to prevent financial abuses like the Wells Fargo fake accounts scandal. They also voiced concern about the need for subprime auto lending protections and stories of financial institutions’ discriminatory lending practices and abusive workplaces, the committee said.
“Preserving the CFPB is essential to monitoring fraud within the big federal banks,” former bank employee Ruth Landaverde said. “I worked as a customer service and mortgage specialist for years at both Wells Fargo and Bank of America. I often found that customer needs and wants were not my main priority at my job – the pressure was really to hit sales goals at any cost. … Strong enforcement is required to protect American communities from financial trickery in the name of profit. I fear that a weakened CFPB will permit another Wells Fargo account fraud scandal to happen – or increase the chances of another financial crisis.”
Marcus Dodson, an account coordinator at US Bank, said the CFPB needed to take a harder line on enforcement to protect bank employees themselves.
“Bank workers in the US do not have any representation,” he said. “As a result, the financial industry has set aggressive, largely unattainable goals and often fosters a work environment that is toxic at best. When I worked in the collections department, for example, my goals increased so rapidly that many of us had to choose between the best solution for the customer or the best outcome for our paychecks. While I worked in collections, roughly 60% of our take-home pay was based on bonuses. Missing the various metrics would cost you your bonus, and missing metric goals for more than four consecutive months could potentially lead to termination. The media has captured just a piece of the story about the financial industry with the Wells Fargo scandal of 206. The CFPB has played an active role in holding the banks accountable for this.”
“The need for regulation over big banks has never been so urgent,” said former Wells Fargo employee Kilian Colin. “As a former worker at Wells Fargo, my job was to open new accounts even when it did not make sense for the customers’ needs. Management within the branch knew the fees and high interest rate were making money on the back of the low- to moderate-income communities!”