'Louder For The Far Right Folks In The Back': Pressley Asks Rohit Chopra To Dispel GOP Claims

3 months ago

At a House Financial Services Committee hearing last week, Rep. Ayanna Pressley (D-MA) questioned CFPB Director Rohit Chopra.

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Transcript

00:00Thank you, Mr. Chair. Thank you for joining us, Director Chopra, and thank you for leading

00:05the Consumer Financial Protection Bureau in its mission to save consumers billions of

00:10their hard-earned dollars by cracking down on junk fees, helping wipe out 70 percent

00:14of medical debt from consumer reports, and ensuring that our data is accurate and secure.

00:21Before I go further, I just want to take a moment for the record. You know, after many

00:27attacks on the CFPB, could you just, for the record, say what the SCOTUS ruling was?

00:38So, in an opinion that was seven to do, authored by Justice Clarence Thomas, the Supreme Court

00:45made crystal clear that the CFPB's funding mechanism complies with all aspects of the

00:53Appropriations Clause. While we prevailed in this, it was a very costly delay. So many

01:01of our lawsuits against bad actors were stalled, paused, and in other cases, companies were

01:09not complying in the way we would expect them to.

01:12Because I do have to get into some other things. Could you just, yes or no, for the record,

01:15is the CFPB constitutional according to the Supreme Court?

01:18Yes.

01:19Louder for the far right folks in the back.

01:21Yes.

01:22Very good. All right, in a few months, millions of students will be returning to the college

01:25campuses to continue their education and start their freshman year, including in my district,

01:29the MA-7th, which is home to one of the largest concentrations of higher learning institutions

01:33in the country. This is an exciting time for a new generation of young people, two of my

01:37incredible interns joining us today, in fact, for whom this is often their first time living

01:41alone, managing a budget, exploring their potential academic and career futures. However,

01:45many of these students have little or no financial experience, zero income, and a lack

01:49of sufficient savings cushions for emergencies. In other words, they are vulnerable to financial

01:54exploitation. The CFPB has documented numerous cases of financial abuse in the student loan

01:58and credit card markets. It is increasingly clear that students are being driven towards

02:02more expensive products in the student prepaid and debit account markets as well. I would

02:09like to enter for the record the College Banking and Credit Card Agreement's annual report

02:14to Congress. Director Chopra, the report raises concerns about transparency and compliance

02:21of banking products marketed to college students. What actions has the CFPB taken to ensure

02:26appropriate disclosure requirements are being met by the universities? Well, I think this

02:31is a very, very significant problem that in some ways represents problems of the past.

02:37We saw how student lenders were giving kickbacks to colleges, steering them into a specific

02:43loan. We saw how credit card issuers were targeting on-campus and college. Congress

02:49banned those student loan kickbacks. They banned that on-campus giveaways by credit

02:55card companies. I do think we need to continue to make sure that not just the banks are providing

03:01the right disclosures, but we're really looking with the Department of Education about the

03:05relationships between colleges and banks. Thank you. The report further highlights that

03:10the products marketed to students are often more expensive. For example, the debit cards

03:14marketed to students often consist of high overdraft fees, inactivity fees, monthly service

03:19fees, even though cheaper options are available, resulting in some students saying that they

03:24had to fast for days, use candles to reduce electricity costs, and even forego textbooks.

03:31This is unacceptable and, frankly, shameful, and it is all because of predatory and unnecessary

03:35fees charged to their accounts. Director Chopra, these stories are horrifying, and they're

03:40just a small snapshot of how students are being impacted. What steps is the CFPB taking

03:45to protect students from being directed to these expensive banking products, which exploit

03:51their financial situation and inexperience? Well, we're going to continue with the Department

03:55of Education's rules and our rules to make sure that it's not predatory and exploitative

03:59practices. We want to make sure that every college student that is starting this summer

04:04knows they should also look for an account that maybe before they come to campus, they

04:09do not have to accept what the college may be pushing on them, and there needs to be

04:13some real look about whether colleges should be getting kickbacks for any of this. Finally,

04:19Director Chopra, I'm concerned by the reports finding that financial inducements to institutions

04:23of higher education from financial service providers may compromise the institution's

04:28ability to prioritize their students' financial well-being. I think we can agree that it poses

04:32a conflict of interest. So how is the CFPB monitoring these agreements, and what steps

04:37are being taken to mitigate any conflict of interest? Well, what's fortunate is many of

04:41these agreements are now public. The credit card agreements are public. We make them public,

04:46but we will also take further enforcement action if there's violations of law, but I

04:50also think Congress should be thinking about reasonable limitations when it comes to these

04:55colleges profiting from it. Thank you for your incredible work that you and your staff

05:00at the CFPB are doing. We appreciate your sweat, equity, and hard work immensely on

05:04behalf of consumers. I yield back. The gentlelady yields back.

'Louder For The Far Right Folks In The Back': Pressley Asks Rohit Chopra To Dispel GOP Claims

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