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Prepared Remarks of CFPB Deputy Director Steven Antonakes at the Consumer Bankers Association

Thank you for making time for me today at CBA Live and for the valuable input you all have given us over the past few years. I appreciate the strong and candid relationship we have developed and our ability to discuss issues fruitfully whether we agree or disagree. Today, I would like to share some updates on our work at the Consumer Bureau.

Our mission is to make the financial markets work better for consumers and responsible providers. We also want to see that the relationship between providers and consumers is placed on a more sustainable foundation. Since our inception, we have sought to use all of our various tools – our supervision, enforcement, and rulemaking authorities, along with consumer education and consumer response – as appropriate to address issues in the consumer financial marketplace.

Our consumer response function, in particular, has taken on a key role in our work. Congress mandated that we develop a system for receiving and handling complaints from the public about the range of markets and financial services within our purview. We started slowly with about 520 credit card complaints in our first month and gradually added more products in stages.

Today we are accepting complaints about a broad range of products, including mortgages, credit cards, auto loans, student loans, bank accounts, payday loans, debt collection, credit reporting, money transfers, and other consumer loans. Word is spreading, as last month we received more than 20,000 complaints and the volume continues to grow.

In total, we have received over 300,000 complaints thus far. We also see our public Consumer Complaint Database as a diagnostic tool for industry. It is similar to what the National Highway Traffic Safety Administration did forty years ago with complaints about auto safety. That effort, which initially was the source of criticism from industry, eventually won their praise as it helped to reduce litigation costs, regulatory risk, and reputational risk over time.

The central emphasis at the Bureau on the voice of the consumer is likewise playing a tangible role in producing a shift in the financial marketplace to an emphasis on legal compliance and excellent customer service. We applaud these conscious efforts as sensible and beneficial developments that will also help earn greater customer loyalty. They are exactly what we are looking for from financial companies operating in these markets.

Our supervision and enforcement work is focused on issues of compliance with law and identifying risk to consumers. It is also helping to drive that cultural change within financial institutions that places more emphasis on compliance and treating customers fairly. We are now increasingly able to level the playing field between banks and their nonbank competitors for the first time. These changes are most notable for the nonbank institutions, but for many banks as well.

Our supervision and enforcement teams are not interested simply in assuring that all the right boxes have been checked, but are asking more fundamental questions. These questions are about whether these institutions are in compliance with federal consumer financial law, whether adequate compliance management systems are in place, and whether consumers are being subjected to unfair, deceptive, or abusive practices. We are focusing on the activities of third-party service providers as well as the institutions they serve.

We keep a watchful eye on the thousands of consumer complaints we receive. We have made clear that the patterns reflected in those complaints can prompt enforcement investigations or be the basis for risk scoping that leads to prioritizing supervisory attention. We have seen that many financial institutions are wisely building into their compliance management systems an increased attention to the fairness of their practices and to the honesty and clarity of their marketing materials.

They are more closely monitoring the actions of their service providers and paying more attention to the broader trends revealed by their analysis of our consumer complaints and as well as their own customer complaints. We applaud this sensible response as well, which again will tend to pay dividends by minimizing litigation risk, reputational risk, and regulatory risk, and by strengthening the relationship of financial institutions with their customers.

In addition, financial education is a critical component of our work, and we are committed to helping consumers increase their capability to make sound financial choices that will serve their own life goals. Consumers are in a better position to do this when they are able to ask questions and receive unbiased answers. That is why the Bureau built our “Ask CFPB” tool.

Consumers can go to our website at to find reliable answers to more than a thousand questions about financial products and money management. It has information for parents who want tips on how to talk to their child about money. It has information for consumers who want to know more about credit cards, checking accounts, or mortgages.


In doing our work, we are striving to strike the right balance as we write rules, conduct examinations, and handle investigations. Our new mortgage rules are premised on two basic principles: no debt traps and no runarounds. It is in the long-term interests of responsible providers and our broader economy that consumers should be set up for success rather than failure. So under our Ability-to-Repay rule (also known as the Qualified Mortgage or QM rule), lenders must make a reasonable determination in good faith that for the mortgages they offer, consumers can actually afford to pay them back.

This basically marks a return to solid mortgage underwriting. And mortgage servicers must be responsive and work with struggling borrowers to access the available alternatives to foreclosure, since those alternatives often lead to better outcomes for the mortgage holders as well. These concepts are fairly simple and perhaps a bit old-fashioned, but they should help prevent needless foreclosures. And that is best for borrowers, lenders, and our entire economy.

Our goal is not some one-sided aim to maximize consumer protection or industry deterrence at all costs. There is such a thing as doing too little, and there is such a thing as doing too much. We are aiming instead at doing justice. On the facts of each matter, we are focused on getting things right, as far as we can manage to do so, which is why we have closed several enforcement investigations to date with no finding of a legal violation.

Moreover, our goal is not simply to identify violations of the law through our own work. We are also seeking to incentivize conduct that leads to greater levels of compliance on the part of the financial institutions themselves. In our “responsible conduct” policy, we are quite willing to take into account proactive compliance efforts by institutions that take the initiative to identify and correct problems without having to be prompted.

We can and will consider such conduct within our discretion in deciding whether a particular matter justifies a public enforcement action and assessing what level of civil penalties should be levied. In fact, we have relied on this approach in several matters already.


Another recent project that we believe is good for the entire economy is the ongoing initiative in the credit card industry to make credit scoring information more easily and regularly available to credit card customers at no cost. Several issuers have introduced programs that promise to dramatically expand the number of consumers who routinely see their credit information.

The programs are providing customers directly with the same credit scores these issuers already obtain in their normal course of business, along with related educational materials, which help consumers understand the significance of their credit scores.

We are encouraging all credit card companies to consider making credit scores and educational content freely available to their customers on a regular basis. Director Cordray has personally advocated to top executives that this is a best practice that will benefit both providers and consumers.

We believe it will make people more aware of their credit standing, more capable of protecting themselves, more able to benefit from the opportunities that credit can create, and ultimately make them more productive members of our economy.

We see no reason why this approach should not be replicated with customers across other product lines as well. Some institutions have indicated they will be expanding this initiative to other areas in which they use credit scores, such as mortgages, auto loans, and even basic bank accounts. The core principle is the same, and so much the better.


In other areas, we are using our various tools to address harm to consumers while leveling the playing field between bank and nonbank financial providers. One area of concern for us is debt collection. Coming out of the financial crisis, the best estimates are that 30 million Americans have one or more debts in collection for amounts that now average $1,500 per person.

Collection of consumer debts serves an important role in the proper functioning of consumer credit markets. But certain debt collection practices have long been a source of frustration for many consumers, generating a high volume of consumer complaints at all levels of government.

So we recently ordered Cash America, one of the largest payday lenders, to refund consumers up to $14 million and pay a $5 million fine for robo-signing debt collection documents; illegally overcharging service members; and destroying records in advance of our examination. We also recently filed a lawsuit against CashCall, an online loan servicer that we believe has violated federal law by seeking to collect on loans that are void or otherwise uncollectable by law.

In the field of debt collection, the main federal law was enacted in 1977 and until the Consumer Bureau was given this new authority, no federal agency could write rules to determine how the law should be applied to modern technology.

We have published an Advance Notice of Proposed Rulemaking asking consumers for feedback about their experiences with debt collection and asking the industry for information about their practices. We expressed our concerns about certain processes and certain players in this marketplace, including creditors that are collecting on their own debts as well as third-party collectors and debt buyers.

We want to ensure that all those engaged in collection activity are seeking to recover debts from the right people in the right amounts and treating consumers with the dignity and respect they deserve. In particular, we have seen how the accuracy of account information can degrade as it is passed on from the original creditor to debt collection firms and sometimes to multiple rounds of debt buyers. We believe irresponsible practices have unjustifiably hurt consumers. New rules can help to clean up these practices and reduce these harms.

Another area where we can do more for consumers in part by creating a more level playing field is student loan servicing. Leaders across the financial sector share our concern that heavy student loan debt burdens are encumbering many of our best young people as they are entering the workforce. They are delaying homeownership, small business development, and other activity critical to our economic recovery.

Young people are struggling with poor customer service from some servicers managing their federal and private loans. These problems are eerily reminiscent of the problems that have plagued the mortgage servicing industry for years. When borrowers are unable to get accurate account information, enroll in available loan modification programs, and manage their debt successfully, there are ripple effects for the broader economy.

This needs to change. So we took the steps necessary to expand our supervisory jurisdiction beyond the larger banks to the larger nonbank firms that engage in student loan servicing. We will exercise this new authority to examine whether student loan servicers are complying with the law and treating their customers fairly.

Another difficult area where we are working to mitigate harm to consumers and level the playing field is indirect auto lending. For some time now, we have expressed concern that discretionary pricing in auto finance, coupled with financial incentives to mark up interest rates – practices that are akin to the now-banned yield spread premiums in the mortgage market – create serious risks. Such risks include that consumers will receive different pricing based on prohibited characteristics such as race, ethnicity, and national origin.

We fully recognize that the issues here can be complex and that our authority generally reaches auto lenders but not auto dealers. This can pose difficulties in addressing these issues comprehensively. But it is nonetheless our responsibility to enforce the law.

In December, we partnered with the Department of Justice and ordered Ally, one of the top indirect auto lenders, to pay $98 million to address discrimination against more than 235,000 minority consumers. The discrimination was caused by a discretionary pricing system that lacked effective monitoring and controls. This was the largest auto loan discrimination case in U.S. history, and it indicates our joint resolve on the issue.

In addition, we will be moving forward with a proposal to expand our supervisory authority in this area beyond the larger banks to encompass the larger nonbank auto lenders also, providing more complete oversight over the lender side of this marketplace.


As you can see, we are striving to fashion a consumer financial marketplace that works better for both consumers and responsible businesses. Some of these issues are complex, and we may disagree at times about the right approach to take. Nonetheless, I believe that many of you share much of our long-term vision for consumer finance markets.

That vision is of a market where consumer protections and business opportunities work in tandem; where financial firms lead through responsible business practices; and where consumers who are more educated can make well-informed decisions.

We believe that such a marketplace is the right outcome for all involved, and that it will lead to more stable and sustainable financial conditions that strengthen the future of this country. That must be our common ground, and we ask you to continue to work with us to achieve these mutual goals. Thank you.

The Consumer Financial Protection Bureau is a 21st century agency that implements and enforces Federal consumer financial law and ensures that markets for consumer financial products are fair, transparent, and competitive. For more information, visit