Staff directed to stop rulemaking, suspend pending rules
Donald Trump’s pick for acting director of the Consumer Financial Protection Bureau (CFPB) has ordered staff to end any activity related to enforcement matters and litigation and suspend the effective dates of pending rules in his first hours in the job.
Scott Bessent, the former hedge fund manager who was confirmed as US Treasury Secretary last week, has taken over as acting director of the bureau after Trump fired Rohit Chopra on Saturday.
The sweeping halt on agency activity was taken to “promote consistency with the goals of the administration,” POLITICO said an email to agency staff on Monday revealed.
Bessent said in a CFPB statement Monday that he would be working with the regulator to “advance President Trump’s agenda to lower costs for the American people and accelerate economic growth,” although it’s not clear whether Trump is actively searching for a more permanent replacement for Chopra.
Appointed by Joe Biden to lead the watchdog, which oversees consumer protection in the financial sector, Chopra unexpectedly remained in his post for nearly two weeks under the new administration but was dismissed by Trump on February 1.
It's been an honor serving as your @CFPB Director.
— Rohit Chopra (@chopracfpb) February 1, 2025
Every day, Americans from across the country shared their ideas and experiences with us. You helped us hold powerful companies & their executives accountable for breaking the law, and you made our work better.
Thank you. 🇺🇸🇺🇸🇺🇸 pic.twitter.com/JD7lIcwmHa
Chopra leaves complicated legacy as CFPB director
The regulator, established in the wake of the 2008 financial crisis, has faced recent criticism within the mortgage industry for what mortgage lawyer Peter Idziak, senior associate at Polunsky Beitel Green, described as a perceived “heavy-handed and adversarial approach under Chopra.”
It’s also in the crosshairs of Elon Musk, head of the Department of Government Efficiency (DOGE), who’s called for the agency to be eradicated entirely. But that’s unlikely to happen under the new acting director, according to Idziak.
“Bessent has recognized that the CFPB was statutorily created by Congress, so I don’t believe he will seek to universally ‘delete’ the Bureau, as Elon Musk has previously called for,” Idziak said.
“But I expect he will move quickly to rescind several rules passed under Chopra that have proven costly to the industry and likely resulted in higher costs for consumers.”
The Consumer Bankers Association (CBA) took aim Monday at what it described as the “partisan policies” enacted by Chopra and welcomed Bessent’s appointment.
“We’re hopeful that Secretary Bessent will take into account the real-world ramifications regulations have on America’s leading banks, the millions of consumers they serve, and the economy as a whole,” CBA president Lindsey Johnson commented.
However, Senator Elizabeth Warren (D-Mass.), who originally proposed the agency’s creation in 2007, said Chopra had held Wall Street accountable during his time leading the CFPB and helped protect Americans from junk fees and predatory lending.
She emphasized the agency’s centrality to some of Trump’s election promises. “President Trump campaigned on capping credit card interest rates at 10% and lowering costs for Americans,” she said.
“He needs a strong CFPB and a strong CFPB director to do that. But if President Trump and Republicans decide to cower to Wall Street billionaires and destroy the agency, they will have a fight on their hands.”
Is the CFPB toast under Trump?
Whether Trump intends to permanently strip back the CFPB remains unclear for now, although leading mortgage industry figures have underlined the positive role played by the agency as a consumer watchdog.
Speaking with Mortgage Professional America last week, Better.com president and chief financial officer Kevin Ryan highlighted the need for a balanced approach to regulatory oversight.
“I think some deregulation is going to help. I don’t think I appreciated when I joined an originator how much time you’d actually spend as a CFO with the CFPB. Any given state can come in at any given moment and do an exam,” he said. “Now: I understand it. It’s the single largest financial transaction that 99% of Americans will ever have, and the single most important asset they’ll ever have – their home.
“So I understand it, and the world was put in jeopardy in 2008 in part from shoddy underwriting and aggressive marketing, and probably some borrowers who were impure in their intentions and what they did. So I get the ‘why’ – although these pendulums swing and sometimes they can swing too far.”
Bessent marks the latest Trump pick for key agencies and departments linked to the mortgage and housing sectors, following a host of other appointments in recent weeks.
The president tapped Scott Turner, whose nomination is still pending Senate confirmation, to lead Housing and Urban Development (HUD) while Bill Pulte was chosen to head the Federal Housing Finance Agency (FHFA), which oversees government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac.
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