In a recent Hill op-ed, We don’t need the Consumer Financial Protection Bureau — we have courts, Vanderbilt Professor Brian T. Fitzpatrick writes:
Many are asking: If the CFPB goes out of business, who will be there to help consumers? The answer is one million lawyers. CFPB has been around for less than 15 years. Consumers were not helpless before then. We do not need more government agencies to police the marketplace — we have the plaintiffs’ bar.
Second, the CFPB does many things no private lawyer can. The CFPB issues regulations, including regulations that provides safe harbors for the industry. It produces model forms that have been tested on consumers to maximize consumer understanding. It supervises the industry; in contrast, private lawyers can’t visit financial institutions to make sure they are complying with the law. The CFPB has access to information private lawyers cannot get, which enables the CFPB to identify problematic practices that would otherwise fly under the radar.
Third, the CFPB was created in part to prevent the kind of lending that led to the Great Recession. We had private lawyers before the Great Recession, and for all the good they did for consumers–and they did a lot of good–they couldn’t prevent the Great Recession.
I could go on, but you get the point. Yes, we need private lawyers, but we need the CFPB too.
