WASHINGTON (Legal Newsline) – A community group is challenging the recent repeal of a Consumer Financial Protection Bureau rule that prohibited short-term loans at high interest rates like payday and auto-title loans
The 2020 Repeal Rule revokes the 2017 measure that said such loans were unfair because customers are often not aware of their usurious terms, the National Association for Latino Community Asset Builders said in an Oct. 29 lawsuit in District of Columbia federal court.
“The Repeal Rule invents a new evidentiary standard — distinct from any statutory requirement — and changes the CFPB’s interpretation or application of the statutory definitions of unfair and abusive,” the suit says.
“These changes are not supported by reasoned explanations and appear custom-designed to repeal the ability-to-repay protections of the 2017 Payday Lending Rule.”
The CFPB failed to consider the harms this will inflict on the public, the case says.