November 12, 2013

Senator Warren Asks CFPB Director Cordray About Agency's Efforts on Veterans Scams, Car Loans

Washington, DC – At a Senate Banking Committee hearing today, United States Senator Elizabeth Warren (D-Mass.) asked Consumer Financial Protection Bureau (CFPB) Director Richard Cordray about the agency’s efforts to protect older veterans from financial scams and to combat auto loan scams. 


Senator Warren asked about scams targeting the Department of Veterans Affairs’ “aid and attendance benefit,” which helps pay for the cost of nursing homes and in-home health aides for disabled veterans. “The aid and attendance benefit is a significant way that we show our veterans our appreciation,” said Senator Warren. “And these scams are turning a benefit into something that actually undermines the financial security of our older veterans.”


Recently, Senator Warren held roundtable discussions in Boston and Lowell with CFPB Office of Servicemember Affairs Director Holly Petraeus on financial issues facing servicemembers, veterans, and their families.


During today's hearing, Senator Warren also questioned Director Cordray about protections for consumers purchasing cars. She explained that auto dealers act as intermediaries between car buyers and financial institutions when the buyer is looking for a loan, and all too often, charge consumers a higher interest rate than the quote they received from the financial institution while pocketing the difference.  Although the CFPB has authority to regulate nearly every kind of consumer loan, there is a loophole for car loans.


Senator Warren highlighted a recent Bipartisan Policy Center report recommending Congress close this loophole to give the CFPB authority to take actions that would protect families from being cheated on car loans. “I think the CFPB has done great work, and great work in this area as best it can,” said Senator Warren. “But it makes no sense to me that there should be any exception here for consumers who are being tricked out of billions of dollars every year on car loans.”


Video of Senator Warren’s Q&A at today’s hearing is available here.