California Attorney General Rob Bonta, joined by 19 other state attorneys general, has urged the Consumer Financial Protection Bureau not to move forward with proposals that would sharply limit its supervision of debt collection, credit reporting, auto finance, and international money transfer markets.
Why it matters: These four markets generate some of the highest levels of consumer complaints the CFPB receives, according to the AGs. The proposals would leave only a handful of companies under federal supervision, excluding most of the firms consumers deal with every day.
- The Trump Administration’s plan would restrict oversight to as few as 11 debt collectors, six consumer reporting companies, four money transfer providers, and five auto finance companies.
- Attorneys general argue this would gut federal protections and run counter to the CFPB’s statutory duty to maintain risk-based supervision.
The big picture: The CFPB’s advance notices of proposed rulemaking revisit its “larger participant” rules, which define which nonbank companies are subject to federal exams. The Bureau, led by Acting Director Russell Vought, says higher thresholds could reduce compliance burdens and conserve resources.
What they’re saying:
- “With these proposals to limit its own oversight of critical financial markets, the CFPB is attempting to skirt its obligation under federal law to protect American consumers,” Bonta said.
- In a separate letter opposing the debt collection proposal, 18 attorneys general and D.C. AG Brian Schwalb wrote that raising the supervision threshold to $100 million in annual receipts would reduce oversight to just 11 firms, thereby covering only 18% of the market by revenue.
By the numbers:
- Debt collection complaints to the CFPB nearly doubled in one year, from 98,000 in 2023 to more than 207,000 in 2024.
- Credit reporting issues generated 2.7 million complaints in 2024, 85% of all CFPB complaints.
- Auto financing produced 18,000 complaints last year, with particular concern over subprime lenders.
Between the lines: AGs argue the compliance costs the CFPB cites — about $27,000 per exam — are minimal compared to the harm caused by abusive practices. They also note that smaller debt collectors with limited compliance resources may be most likely to violate rules like Regulation F, making broad supervision essential.
What’s next: The CFPB is collecting public comments on the proposals. If finalized, the changes could shrink its supervisory authority in these markets by more than 90%.
