Consumer Financial Protection Bureau (Executive Calendar)
Mr. President, the bill that Senate Republicans have brought to the floor today and which we will vote on sometime soon is the latest example of the ``great betrayal'' in action. On the campaign trail, Candidate Donald Trump promised that…
Mr. President, the bill that Senate Republicans have brought to the floor today and which we will vote on sometime soon is the latest example of the ``great betrayal'' in action.
On the campaign trail, Candidate Donald Trump promised that he was going to help Americans deal with their pocketbook issues, kitchen table issues, and he said that on day one--day one--he was going to bring prices down; that he was going to bring down costs for American families. Well, costs are going up, and President Trump and Republicans are taking actions that will raise those costs on the American people even further, and today's bill is exhibit A.
I want to take a step back and put this bill that we are considering today in context. You know, one of the infuriating experiences that so many American consumers have is the mountain of junk fees they face. These are hidden fees that are sometimes in very fine print in contracts. They are all these fees that get added to their bills, where they really have no idea what additional value they are getting for those fees because often there is no additional value for that fee or that the additional value is minuscule in comparison to the fee they are being charged. So people pay these fees and grind their teeth and essentially get ripped off. We also see many predatory lending practices, where financial interests prey on those who are living paycheck to paycheck.
So, years ago, after the financial crisis of 2008, Congress created the Consumer Financial Protection Bureau--also known by its shorthand CFPB--to help protect American consumers from a whole range of predatory practices. Senator Warren was one of the people who thought of establishing that important consumer protection Agency. Now she is the ranking Democrat on the Banking and Housing Committee, on which I am privileged to serve.
Since its creation, the CFPB has gone after all sorts of fraudsters, all sorts of con artists, all sorts of people who try to find different ways to cheat American consumers out of their hard-earned money. They have been successful, the Consumer Financial Protection Bureau. They have returned over $21 billion to American consumers who have been cheated out of their hard-earned money. In other words, they brought lawsuits to go after these fraudsters or changed practices in order to make sure that people could keep more of their hard-earned money. That includes $71 million that was returned to my constituents in the State of Maryland who were ripped off.
Along the way, the CFPB made some powerful enemies, and many Republicans have been trying to dismantle the CFPB for years. Now they have Elon Musk to help do their dirty work.
In one of the most corrupt bargains in American history, Elon Musk spent $280 million to help elect Donald Trump, and Donald Trump has turned around and given Elon Musk the keys to many Federal Agencies. Make no mistake, this has nothing to do with making the Federal Government more efficient and has everything to do with rigging the government to serve people like Elon Musk at the expense of everybody else in America. In fact, one of the great examples of that is that they went right after the Consumer Financial Protection Bureau.
I find it just gross that the richest man in the world would go after a Bureau whose purpose it is to help return money to American consumers who have been cheated out of their hard-earned dollars, but that was one of the very early targets of Elon Musk and his DOGE cronies.
Now, apparently, that wasn't enough. It was not enough just to go after and try to dismantle that Agency. That step and the one we are dealing with here in the Senate today is an effort to go back and undo some of the important consumer protections that the CFPB put in place under the Biden administration.
One of those protections was a rule that is in place now to prevent banks from charging consumers exorbitant fees when a consumer overdraws their account balances using a debit card.
So how does this work? Well, let's say you have got your debit card. You go into the grocery store. You are going to buy some groceries for the family. You use your debit card to pay, and you overdraw your account. Now, some of the biggest banks in the country will typically charge you $35 for each of those overdrafts no matter how big your overdraft amount is. So you overdraw your account by one buck, $35; by 5 bucks, $35.
The average overdraft amount is $26. So you can see on each one of those transactions those banks are making a hefty return. In fact, it is like a loan with an APR of 16,000 percent. And it happens time after time. In other words, you leave the grocery store. You go pick up your kids at school. You go to a local convenience shop. You get a cup of coffee. You pay with your debit card, and--boom--you get hit with another $35 overdraft fee. And on and on and on.
In fact, every year, some of the biggest banks--Wells Fargo and Chase--make over $1 billion from consumer overdraft fees. And some of these banks have built an entire system to try to maximize the amount they get from their consumers through these overdraft fees. If you look collectively at the banking system, this is a $5 billion-a-year rip- off.
So if you look at the people who are being primarily hit by this, not surprisingly, it is people who are living paycheck to paycheck--in fact, many of the people who Candidate Trump said he wanted to look out for when he was campaigning in the last election.
If you look closely, you will find that 79 percent of overdraft fees are charged on about 9 percent of accounts. These are accounts where people have an average balance of around $350. So these big banks are preying on the people who literally are going paycheck to paycheck. And for those households, the average hit every year is about $225 in exorbitant fees. So you make a tiny miscalculation, and you get hit hard by these predatory practices.
Last year--this last year--the Consumer Financial Protection Bureau-- the one that Elon Musk and DOGE are trying to shut down as we speak-- last year, they developed a rule to help protect consumers. It was something many of us had pushed for years, and we were glad to see them do it.
The rule was pretty straightforward. It would cap the overdraft fees at $5 a time instead of $35 a time. And it would also require banks to be transparent in their pricing and their overdraft penalty structure so that consumers would know and have eyes wide open as to what penalties they were going to incur. So you wouldn't have people inadvertently hit with 35 bucks for a cup of coffee, 35 bucks when you go pick up some more groceries.
This has become a way for some of the biggest banks to rip off consumers, especially those who are going paycheck to paycheck, as I said, to the tune of $5 billion.
So that is the rule. That is what the CFPB did, pretty simple measure: Make sure that consumers don't get ripped off and not even know they are being ripped off sometimes until they know about the overdraft fee.
What Republicans have brought to the floor today is a proposal to override that consumer protection bill to allow those banks to continue to collect $5 billion from American consumers, so many of them who are living paycheck to paycheck.
Everybody should know that that is what is going on here. We have got the richest man in the world trying to shut down an Agency that was created to help protect consumers, and here in the Senate, we have Senate Republicans trying to overturn a consumer protection rule that saves working people a little bit of money and makes sure that they don't get slammed for making a small overdraft on their accounts.
I urge my colleagues to vote to uphold the consumer protection law that was adopted. If you want to vote yes to protect the rule, you vote no on this effort to overturn it. I urge my colleagues to vote no.
I yield the floor.