Subcommittee on Economic and Consumer Policy Examined CFBP Proposed Repeal of the Payday Lending Rule
Washington, D.C. (May 17, 2019)— This week, the Subcommittee on Economic and Consumer Policy, chaired by Rep. Raja Krishnamoorthi, held a hearing on “CFPB’s Role in Empowering Predatory Lenders: Examining the Proposed Repeal of the Payday Lending Rule.”
- The payday lending industry has improperly influenced the rulemaking process by paying professors to draft pro-payday lending “studies” that were fraudulently disguised as independent academic work. Thomas Pahl, the Policy Associate Director for Research, Markets & Regulations for CFPB, testified that CFPB would still consider the data in those studies valid, even though they were ghostwritten by the payday lending industry. The industry is also suspected of submitting fake and coerced comments submitted to CFPB to influence its rulemaking.
- Contrary to CFPB’s statement, Chairman Krishnamoorthi quoted payday lobbyist Hilary Miller who claimed to have met with CFPB before the proposed repeal of the payday rule. Mr. Pahl committed to providing “the details of every single meeting that the CFPB had with industry” to the Subcommittee within two weeks.
- Mr. Pahl confirmed in his testimony that payday lenders would earn an extra $8 billion per year under the proposed rule change.
Policy Associate Director for Research, Markets & Regulations
Consumer Financial Protection Bureau
Watch Chairman Krishnamoorthi’s opening statement.
Watch Rep. Connolly’s question line
Watch Rep. Tlaib’s question line.
Watch Rep. Krishnamoorthi’s question line.