Attorney General Dana Nessel has joined 23 states and the District of Columbia in urging the federal Consumer Financial Protection Bureau (CFPB) to finalize regulations for payday lenders.
In signing the letter with almost half of the country’s state attorneys general, Nessel said she aims to protect consumers in Michigan from falling victim to payday loan sequences. Twenty percent of these end with the consumer in default, according to CFPB data.
“My office has a responsibility to act when Michiganders are at risk of deceitful and abusive business practices,” Nessel said in a statement. “By delaying these protections, more consumers risk becoming victims of predatory and misleading tactics by payday lenders, and that’s more than enough reason for Michigan to step in and speak out.”
Under the President Donald Trump administration, the CFPD has sought to rescind and delay implementation of various regulations that would protect consumers, the 25 attorneys generals wrote in a letter this week to Kathy Kraninger, CFPB’s director. The agency was previously helmed by Trump’s now-Chief of Staff Mick Mulvaney.
The attorneys general say that the ongoing delay to implement a rule that would require lenders to make certain underwriting determinations before giving credit makes their jobs more difficult and potentially leaves citizens vulnerable to predatory lending.
“The delay in the Underwriting Protections will leave the citizens of our states unprotected from many types of exploitative loans, and could embolden lenders who would seek to circumvent the laws of those states with strong protections against such loans,” wrote the attorneys general.