Since its creation in 2010, certain members of Congress have been desperate to thwart the Consumer Financial Protection Bureau (CFPB) by repeatedly passing bills to limit the CFPB’s power. Generally throwing a fit, these congressmen claim that the CFPB is a “run-away regulator unlike any other in American history.”
A case decided last week by the Ninth Circuit Court of Appeals, Gutierrez v. Wells Fargo Bank, shows why the CFPB is so important, how its predecessor (the Office of the Comptroller of the Currency) failed the American public, and why we should view anyone opposed to the CFPB with deep suspicion.
The Gutierrez case arises from a change Wells Fargo made to the processing of debit card transactions back in 2001. Wells Fargo claimed in its brochures that, when a consumer used a debit card, the money was “immediately” and “automatically” deducted from their accounts, and admonished customers — with the type of blatant hypocrisy only a true scoundrel can muster — “remember that whenever you use your debit-card, the money is immediately withdrawn from your checking account. If you don’t have enough money in your account to cover the withdrawal, your purchase won’t be approved.”
In reality, Wells Fargo waited until the end of each day, when it would re-order the transactions to create as many overdrafts as theoretically possible, and then charge the customer a fee for each bank-manufactured overdraft.
Continue Reading Rampant Bank Fraud Shows Why We Need The Consumer Financial Protection Bureau