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Cummings Opposes Legislation to Eliminate Protections for Minority Consumers

Nov 18, 2015
Press Release

Cummings Opposes Legislation to  Eliminate Protections for Minority Consumers

 

Washington, D.C. (Nov. 18, 2015)—Today, Rep. Elijah E. Cummings, Ranking Member of the House Committee on Oversight and Government Reform, spoke on the House floor in opposition to H.R. 1737, the Reforming CFPB Indirect Auto Financing Guidance Act. The legislation would eliminate the Consumer Financial Protection Bureau’s ability to protect minority consumers from being charged abusive and predatory interest rates.

“The Consumer Financial Protection Bureau protects minority purchasers against auto dealers that seek to charge abusive and predatory markups,” said Cummings. “The purpose of the bill before us today is to eliminate this protection – leaving minority consumers at risk of being charged abusive and predatory interest rates.”

More than 60 organizations oppose H.R. 1737, including the National Association of Minority Auto Dealers, Center for Responsible Lending and the Leadership Conference on Civil and Human Rights.

Below are Ranking Member Cummings’s remarks, as prepared for delivery, on the House floor today, and the video of his speech:

 

Floor Statement of Ranking Member Elijah E. Cummings

 H.R. 1737, the Reforming CFPB Indirect Auto Financing Guidance Act

November 18, 2015

  

Thank you, Ranking Member Waters, for yielding me time and for your leadership on the Financial Services Committee.

I rise today to oppose H.R. 1737.  If this bill is enacted, it will cost minority auto purchasers millions of dollars.

Car purchases are extremely complicated transactions.  Most Americans make only a few in a lifetime, and they are not familiar with many of the detailed terms and procedures of these transactions.

One thing that is not complicated is that charging a markup just because a buyer is a minority is illegal.

The Consumer Financial Protection Bureau protects minority purchasers against auto dealers that seek to charge abusive and predatory markups.

The purpose of the bill before us today is to eliminate this protection – leaving minority consumers at risk of being charged abusive and predatory interest rates.

In 2013, the CFPB ordered Ally Bank to pay $80 million in damages and $18 million in penalties for imposing higher interest rates on 235,000 minority borrowers. 

Just this year, the Bureau ordered Fifth-Third Bank to pay $18 million in damages for permitting markups of as much as 2.5% for minorities. 

Because this bill would prevent the CFPB from carrying out its duty to protect minority borrowers, the Administration has announced they are opposed to this bill.

This house should reject H.R. 1737 and every repeated effort to undermine the CFPB. 

114th Congress