SACRAMENTO — California's attorney general is the latest to join a bipartisan, multistate coalition condemning the Consumer Financial Protection Bureau's (CFPB) decision to eliminate oversight of lender compliance of the Military Lending Act (MLA).
Attorney General Xavier Becerra and the coalition are criticizing CFPB acting director Mick Mulvaney's decision to not provide oversight over the MLA caps on interest rates, banning of arbitration and limiting finance charges for military members and their families seeking consumer loans.
“Military service members and their families have made exceptional sacrifices for the well-being and protection of our country," Becerra said in a statement. "Yet the current leadership at the Consumer Financial Protection Bureau is reversing course and treating them disgracefully.
"Rather than honor service members by protecting them from predatory lenders, CFPB Acting Director Mick Mulvaney has shamefully turned his back. Mulvaney’s directive for the CFPB to ignore the MLA and its legal obligation to oversee lenders isn’t just irresponsible, it is a whole new level of low.”
The MLA was passed in 2006 under the George W. Bush administration and is designed to protect service members and their immediate families against loans charging more than 36 percent interest or excessive finance charges and binding arbitration, according to the Attorney General's Office.
The coalition's issues with the CFPB include failure to enforce the MLA and punish abusive lenders and interpreting the MLA without consulting the Defense Department, Becerra's office said.