The Consumer Financial Protection Bureau (CFPB), a government watchdog created in July 2011 to combat financial fraud and protect consumers, is the latest target of President Donald Trump and Elon Musk’s overhaul of the federal government.
Earlier this month, Trump fired the agency's director, Rohit Chopra. Over the weekend, Russell Vought, the new head of the Office of Management and Budget, directed the CFPB to stop all investigations, supervision, actions and any work on proposed rules that have not yet been enacted. Visitors to the CFPB website are greeted with a “Page not found” message, though at least for now, you can still navigate to other pages on the website that have retained information.
Shutting down the CFPB requires the support of Congress; this move, like other Trump actions, will likely end up in court. But in the meantime, consumers could lose oversight from a government agency whose sole mission is to protect them.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The CFPB was created after the 2007-2009 financial crisis, which was partly caused by loose regulations and limited oversight of the financial industry. While the White House claims it is ridding the federal government of fraud and waste, the CFPB has done much to protect consumers, including retirees.
Fining companies billions of dollars
In the nearly fourteen years the CFPB has been in operation, the agency has gone after banks, mortgage lenders, credit card companies and debt collectors that have committed fraud or taken advantage of consumers.
As of the end of January, the CFPB has recouped nearly $20 billion for about 195 million consumers in the form of monetary compensation, principal reductions, canceled debts and other consumer relief. It has fined businesses about $5 billion and has brought enforcement actions against 377 businesses, including:
Bank of America: Fined over $190 million for “double-dipping” non-sufficient fund fees, opening unauthorized consumer financial accounts and making misleading statements about certain credit card rewards.
Wells Fargo: Ordered to return over $2 billion to harmed consumers and pay a $1.7 billion fine for violating laws in several product lines including auto loans and mortgages. The CFPB found Wells Fargo “misapplied loan payments, wrongfully foreclosed on homes and illegally repossessed vehicles, incorrectly assessed fees and interest, charged surprise overdraft fees along with other illegal activity affecting over 16 million consumer accounts.”
Equifax: Fined $15 million for ignoring consumers' documents and evidence submitted with disputes, allowing previously deleted inaccuracies to be reinserted into credit reports and using flawed software code, which led to inaccurate consumer credit scores.
Saving Americans billions in junk fees
Beyond enforcement actions, the CFPB has been instrumental in saving Americans money. In December 2024 it closed an overdraft loophole that it says saves Americans billions of dollars in fees.
Under the new rule, banks that want to profit from overdraft fees have to cap their overdraft fee at $5 or disclose the terms of their overdraft loans like other loans, including giving consumers a choice on whether to open the line of overdraft credit, providing account-opening disclosures that would allow comparison shopping, sending periodic statements and giving consumers a choice of whether to pay automatically or manually.
Banks and credit unions offering overdrafts as a courtesy are allowed to cap them at the amount that covers their costs and losses.
"For far too long, the largest banks have exploited a legal loophole that has drained billions of dollars from Americans' deposit accounts," CFPB’s Chopra said at the time. "The CFPB is cracking down on these excessive junk fees and requiring big banks to come clean about the interest rate they're charging on overdraft loans."
In addition to closing the loophole, the CFPB has ordered banks, including Navy Federal Credit Union, Wells Fargo, Regions Bank and Atlantic Union, to return $446 million in illegal overdraft fees to consumers.
As recently as early January the CFPB was at it again, issuing a final rule that it says will remove $49 billion in medical bills from the credit reports of around 15 million Americans.
The rule bans medical bills from appearing on credit reports used by lenders. It also prevents lenders from using medical information to decide whether to approve or deny loans.
The CFPB said the rule should lead to the approval of approximately 22,000 additional, affordable mortgages every year and that Americans with medical debt on their credit reports could see their credit scores rise by an average of 20 points.
Protecting older adults from fraud
For retirees in particular, the CFPB has programs to protect older adults from fraud, avoid financial exploitation and make sound financial decisions about retirement and Social Security.
Take the CFPB’s “Money Smart for Older Adults” program as one example. This program provides information to help older adults spot scams, manage their money and understand important documents such as power of attorney.
The CFPB's website also has a plethora of tools and resources to assist older adults, retirees and surviving spouses. It also runs a list of state and local resources and legal aid to help victims, caregivers, family and friends respond to elder financial abuse.
Is the CFPB worth it for older adults?
The CFPB was created in the wake of a financial crisis that resulted in record layoffs and foreclosures.
In its nearly fourteen years as the financial industry’s only government watchdog, it has worked to protect consumers and claw back billions of dollars in ill-gotten gains.
While the fate of this agency is uncertain, one thing is for sure: it has demonstrated it has the back of consumers, including retirees.
Related content
-
2025 Virginia Tax Rebates Coming Soon? What to Know NowTax Rebates Given a historic 2025 gubernatorial race, tax policy will remain a key issue for Virginians in the months ahead.
-
What to Know Before Flying With Your PetFrom documentation and TSA screening to carrier rules and airport relief areas, here’s what to know before taking your pet on a flight.
-
Want To Retire at 60? See if You Can Answer These Five QuestionsForget waiting for Social Security and Medicare to kick in. You may be able to retire sooner than you think.
-
Trump Tariffs and Taxes: Waiting to See What Happens Is Not a StrategyLike presidents, tariffs come and go. Policy changes also shift about every two years with the election cycle. If you're paralyzed by uncertainty, you could be missing opportunities to benefit your financial future.
-
Is a Family Office Right for You? The Multimillion-Dollar QuestionAs ultra-high-net-worth individuals increase in number, many are turning to family offices to manage their complex finances. Here's how family offices work, courtesy of a finance professional.
-
The Hidden Cost That's Ruining Vacation Home DreamsAre rising HOA fees derailing your second home dreams? Annual dues, insurance premiums and taxes are rising, boosting total ownership costs. Here's what you can do.
-
If You're Ignoring Private Markets, You're Missing Most of the ActionPrivate markets are becoming increasingly essential for all investors, not just institutions, and they are now more easily accessible thanks to innovative investment structures.
-
Three Ways Women Can Keep Caregiving From Draining Them FinanciallyMany women care for older relatives. While commendable, it could put their retirement at risk … unless they find a way to prioritize themselves.
-
Retire in Malaysia for Affordable LuxuryMany expats retire in Malaysia, a Southeast Asian country with a world-class city. Come for the affordable living, stay for the top-notch health care and cuisine.
-
I'm a Financial Professional: This Is the Roth Conversion Mistake Too Many People MakeConverting your traditional IRA to a Roth can be a fantastic tax-saving move, but you've got to be smart about two things: how much and when.
