On February 27, 2025, the US Consumer Financial Protection Bureau (CFPB) announced the dismissal of a legal action against Capital One, which had been accused of misleading consumers regarding over $2 billion in interest payments on savings accounts. This decision is part of a broader trend under the Trump administration to reduce enforcement actions by the CFPB.
- CFPB dropped legal action against Capital One
- Trump aims to dismantle the CFPB
- Broader retrenchment of CFPB enforcement actions
- Dismissed lawsuits against PHEAA and Solo Funds
- McKernan criticized past enforcement as excessive
- Administration claims streamlined CFPB will suffice
The dismissal of the case against Capital One follows a series of similar actions by the CFPB. Earlier on the same day, the agency also dropped a lawsuit against the Pennsylvania Higher Education Assistance Agency (PHEAA) regarding illegal student loan collections. Additionally, last week, the CFPB ended a case against Solo Funds, an online lender accused of misleading borrowers about loan costs.
These actions indicate a significant shift in the CFPB’s approach to enforcement under the current administration. Key points include:
- Capital One was accused of cheating consumers out of more than $2 billion.
- The CFPB has dismissed multiple lawsuits in recent weeks.
- Critics argue that these moves undermine consumer protections.
During a Senate confirmation hearing on the same day, Jonathan McKernan, Trump’s nominee to lead the CFPB, criticized past enforcement actions as excessive. He pledged to uphold the agency’s legal mandates if confirmed. The administration’s strategy appears to focus on streamlining the CFPB, though many Democrats express concern that this will weaken the agency’s ability to protect consumers effectively.
The recent dismissal of cases against Capital One and other financial entities highlights a significant change in the CFPB’s enforcement strategy. As the agency shifts its focus, the implications for consumer protection remain a critical concern for advocates and lawmakers alike.
