BILL COULD LEAD TO MORE BANK BAILOUTS + MORE RECESSIONS
San Francisco, CA, June 6th, 2017— Earlier today, 31 California organizations sent a letter to the California
congressional delegation, urging them to vote “no” on the Financial Choice Act. The bill, introduced by
Representative Jeb Hensarling, would roll back a number of key provisions from the Dodd Frank reform bill and
would dramatically weaken the CFPB’s ability to protect consumers. A hearing on the bill is scheduled for
tomorrow, with a vote by the full house expected sometime this week.
“We’ve seen this movie before, in 2007, when families lost their homes, jobs, and savings, while the largest
banks in America got bailed out,” explains Paulina Gonzalez, executive director of the California
Reinvestment Coalition. “Are members of Congress ready to field thousands of phone calls from their
constituents facing foreclosure again? Are they ready to approve more bailouts for companies like AIG? That’s
the direction this bill takes us in.”
CRC is a nonprofit coalition of 300 community-based organizations throughout California working in affordable
housing, small business lending, financial counseling, and community development. CRC supported the 2010
Dodd Frank financial reform bill that made sweeping reforms to the financial services industry to prevent
another mortgage meltdown and recession. Dodd Frank also created the Consumer Financial Protection Bureau
(CFPB), a federal agency that has obtained nearly $12 billion in relief for consumers harmed by practices like
Wells Fargo’s opening of fake bank accounts.
“Weak regulation and dangerous financial products resulted in tens of thousands of California families losing
their homes to foreclosure,” comments Kevin Stein, deputy director at CRC. “Since opening its doors, the
CFPB has protected consumers, stopped predatory practices, and made our economy safer and more transparent.
Why would Congress want to reverse that progress with the Financial Choice Act?”
According to data from the CFPB, more than 100,000 Californians have contacted the CFPB to submit
complaints about financial service companies, including over 14,000 seniors. Access to capital is a frequent
challenge for small business owners, and the CFPB recently began an effort (1071 data) that will ultimately
result in greater transparency about access to financing for small business owners, including women and
minority small business owners.