• Thu. Dec 1st, 2022

Wall Street’s new enemy is a close ally of Elizabeth Warren

ByCindy J. Daddario

Feb 17, 2022

But it has been blocked by litigation and the Trump White House. The alternate version of his government—issued in 2020– had no such requirement. In fact, little has changed for payday loans so far. Not only will Chopra have to get back into that debate, but he’ll also have to contend with the evolution of these small loans.

Over the past decade, a number of new companies have sprung up that allow workers to receive advance payments on their paychecks for a fee. Under Trump, officials recommended that these so-called Earned Wage Access products are not regulated as credit, but have consumer and worker organizations pushed Chopra to rescind this guidance, which she says creates dangerous loopholes for payday loans. Chopra told me the CFPB would be “looking closely” and would be concerned about increases in employer-related debt in general, such as B. Workers borrowing for training, equipment, or leads. “This is a worrying trend,” he said, “and as the distinction between consumers and workers blurs, we will become increasingly active in this area.”

Thanks to his early days at the CFPB, Chopra was a close ally of Elizabeth Warren for years. “I have no doubt that you are the right person to lead the office at this moment,” the senator said called at his confirmation hearing last year. Thanks to that friendship, progressive advocates were optimistic about the direction Chopra will take the agency. “He’s extraordinarily progressive, but he was also one of the very few registered Democrats to be endorsed by the McConnell spit during the Trump years,” noted Felicia Wong, president of the Roosevelt Institute, a think tank where Chopra briefly served as a fellow .

Still, it won’t be easy to pass reforms that may actually last, as illustrated by the dispute over payday lending, which may partially explain why Chopra’s early actions were such focused to glossier big tech topics like Apple Pay or cryptocurrency. National consumer groups have shown confidence in the CFPB’s new director thanks to his background, but that goodwill may also have led to a confused silence about the agency’s new collections rule, enacted in the final phase of the Trump administration and came into effect in November.