Watchdog Agency’s Closure Sparks Fears of More Military Financial Scams

Lawmakers and advocacy groups are raising concerns about the White House’s decision to close the Consumer Financial Protection Bureau (CFPB), cautioning that service members, veterans, and military families may encounter increased financial scams. Established in 2011 to promote fair and transparent financial services, the agency received close to 100,000 consumer complaints monthly in 2024, a significant number of which came from military-affiliated individuals.

Frequent instances involved credit reporting problems arising from military moves, exploitative mortgage practices impacting VA home loan recipients, and deceptive schemes aimed directly at service members. Internal estimates suggest that the CFPB has facilitated the recovery of over $175 million for veterans and military dependents in recent years.

Last week, the White House declared that the agency would be closed, referencing cost-cutting measures. Acting CFPB Director Russell Vought defended the decision, labeling the bureau “woke and weaponized.” Billionaire Elon Musk, known for his involvement in extensive government restructuring initiatives, is said to have backed the decision.

Critics contend that the closure will increase the vulnerability of service members. Sen. Tammy Duckworth, D-Ill., criticized the decision, asserting, “Abolishing the CFPB will inevitably result in increased waste, fraud, and abuse.” She highlighted predatory auto loans, payday lenders, and student loan scams as instances of financial traps that have traditionally targeted the military community.

House Democratic Whip Katherine Clark, D-Mass., expressed similar concerns, cautioning that the decision favors corporate interests at the expense of safeguarding service members. “The American people did not choose to endorse further deceit,” she stated.

With the CFPB's impending closure, lawmakers are encouraging military families to remain alert to misleading financial practices and predatory lending tactics.

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