CFPB Reports on Unlawful Student Loan Activities, $9B Annual Fraud Losses, and $840M Budget with $20B Returned

The Consumer Financial Protection Bureau (CFPB) has released a special edition of its Supervisory Highlights, addressing a range of unlawful activities identified in the student loan markets. This report comes amid concerns regarding financial fraud, with estimates indicating that Americans lose nearly $9 billion annually to such scams. CFPB Director Rohit Chopra has been criticized for the lack of consumer education efforts, having published only one speech on scam education since his confirmation in 2021, despite the agency's budget of $840 million, of which less than 1% is allocated for consumer education. Additionally, the CFPB has highlighted a recent increase in cash advance fees linked to the legalization of sports betting in Kansas and Ohio, indicating a potential regulatory gap in loan laws that has allowed overdraft fees to persist outside of existing regulations. The CFPB, alongside the Department of Justice (DOJ), has also issued a joint letter reminding financial institutions of the interest rate protections under the Servicemembers Civil Relief Act (SCRA).