The Federal Trade Commission wants to remind everyone in the credit and collection industry that even though the Consumer Financial Protection Bureau may be downsizing, there is still a federal regulator on the beat, according to a published report.
As the Trump administration continues to dismantle the CFPB by cutting staff, shrinking its oversight, and gutting its funding, the FTC is seizing the opportunity to step into a larger role in policing financial services. That shift could mean fintechs, payday lenders, debt collectors, and credit reporting companies should expect more scrutiny from the FTC, particularly on issues related to data privacy and accuracy.
Chris Mufarrige, director of the FTC’s Bureau of Consumer Protection and a former CFPB senior adviser, said in the report that the agency is leaning back into its historic role. “The Fair Credit Reporting Act, that was the nation’s first privacy law, and we’re also reinvigorating that,” he explained. The FTC has already brought enforcement actions in this space, including a joint settlement with the CFPB against TransUnion in 2023 over tenant screening report accuracy.
Still, consumer advocates and former regulators caution that the FTC’s size and authority pale in comparison to the CFPB. The FTC does not have the same supervisory powers, meaning it must often rely on lengthy investigations to obtain documents and evidence. Patrick Woodall of Americans for Financial Reform noted that Congress created the CFPB precisely because agencies like the FTC failed to detect harmful practices that contributed to the 2008 financial crisis.
Despite those limitations, the FTC has shown a willingness to act. In March, it fined fintech Cleo AI $17 million, and in July it shut down a multi-company scam targeting veterans and seniors under the FCRA and the Gramm-Leach-Bliley Act.
Looking ahead, industry professionals should not assume the regulatory environment is weakening just because the CFPB is retrenching. The FTC is emphasizing its authority over the FCRA and Gramm-Leach-Bliley, which cover the accuracy and privacy of consumer data and the safeguarding of sensitive financial information.
For companies in the credit and collection ecosystem, the message is clear: compliance remains critical. As one former FTC official put it, the agency may be “the little engine that could,” but it remains committed to doing a lot with limited staff.
