ProPublica, January 23, 2018: Newly defanged, top consumer protection agency drops investigation of high-cost lender
In 2013, ProPublica published an investigation of the subprime lender World Finance. World was charging annual interest rates that could exceed 200 percent, often trapping customers in cycles of debt by enticing them to renew the loans over and over. In states where laws barred such high rates, the installment lender loaded many loans with nearly useless insurance products that bloated the cost.
Recently the CFPB sent a letter notifying World Finance that it was dropping its investigation into the installment lender. The company disclosed the letter in a press release yesterday. Although the CFPB had not actually sued the company, it did notify World in 2015 that an enforcement action was likely, according to a company disclosure.
“CFPB should protect consumers, not giant companies that use sky high interest rates to trap hundreds of thousands working Americans in debt,” she wrote. “Dropping this case is more evidence that Mick Mulvaney is just using his time at CFPB to pay back the donors who funded his political career,” said Sen. Elizabeth Warren, D-Mass.