Russell Vought, director of the Office of Management and Budget (OMB) nominee for US President Donald Trump, during a Senate Budget Committee confirmation hearing in Washington, DC, US, on Wednesday, Jan. 22, 2025.
Al Drago | Bloomberg | Getty Images
The Consumer Financial Protection Bureau‘s new leadership on Thursday dismissed at least four enforcement lawsuits undertaken by the previous administration’s director.
In legal filings, the CFPB issued a notice of voluntary dismissal for cases involving Capital One; Berkshire Hathaway-owned Vanderbilt Mortgage & Finance; a Rocket Cos. unit called Rocket Homes Real Estate; and a loan servicer named Pennsylvania Higher Education Assistance Agency.
“The Plaintiff, the Consumer Financial Protection Bureau, dismisses with prejudice this action against all Defendants,” the agency said in the Capital One case. It used similar language in the other cases.
The moves are the latest sign of the abrupt shift at the agency since acting CFPB director Russell Vought took over this month. In conjunction with Elon Musk’s Department of Government Efficiency, the CFPB has shuttered its Washington headquarters, fired about 200 employees and told those who remain to stop nearly all work.
Current and former CFPB employees have told CNBC that legal cases with upcoming docket dates would likely be dismissed as the agency disavows most of what previous director Rohit Chopra has done.
That began late last week, when the agency dismissed its case against SoLo Funds, a fintech lender it had earlier accused of gouging customers.
Eric Halperin, the CFPB’s former head of enforcement, said in a phone interview Thursday that the spate of CFPB dismissals was unprecedented in the bureau’s history.
“Five cases have been dismissed so far by this administration, whereas in the entire history of the Bureau, there’s only been one other case dismissed without relief for any consumers,” Halperin said.
Since the recent cases were dismissed with prejudice, the CFPB has agreed to never bring these claims again, shutting off the possibility of clawing back funds for consumer relief, he added.
“Just from the cases that were dismissed today, there’s billions of dollars in consumer harm that the CFPB will never be able to get back for consumers,” Halperin said.
‘Embarrass you’
The Thursday filings began appearing at the same time that senators were grilling Jonathan McKernan, President Trump’s pick to lead the CFPB on a permanent basis, during a nomination hearing.
“Mr. McKernan, literally while you’ve been sitting here and you’ve been talking about the importance of following the law, we get the news that the CFPB is dropping lawsuits against companies that are cheating American families, or alleged to be cheating American families,” Sen. Elizabeth Warren said.
“It seems to me the timing of that announcement is designed to embarrass you,” Warren said.
This story is developing. Please check back for updates.
