Bureau. Details the creation of the bureau and its work. Good evening everyone. Host on behalf of our organization, is a pleasure to welcome this presentation with richard. I want to acknowledge that our institution stands on the traditional territory of the people particularly here. We thank him for our continuing use of the Natural Resources of the settlement. Only thank you all for tuning in. There is on Youtube Channel our facebook page. In these public strange times and we are thrilled to present virtual editions of our programming. And Live Streaming to create a digital page to conserve town halls. Folks are well beyond. Everyone is willing to talk to their computers now. I want to thank rich for helping us keep the conversation here at town hall. And closed caption version of tonights program, please watch on my youtube page. Rich will speak about for about 20 minutes. After that we will ask questions. You can also go to the questions by clicking the arrow next to the question to upload it. I cannot guarantee that rich will be able to address every question. In 20 minutes is an envelope im bracing must get to work. Upcoming events included bearing witness to the advice. New york editor with a true story of americans. Coproduction with her friends at the farmland trust on climate change. On race and families as well as michael and frank, welcome. Writing tons of programs nearly every day. As well as the events are being releases podcasts. Many of our past podcasts are available in our Digital Media library. We can click on the menu tab in the home page. Will continue to provide and plenty more rabbit holes for you to climb down. Townhalls work made possible for your support and the support of our authors. Civics was supported by the real Network Foundation through others. What is most of you know, town halls organization, is truly member to make this pet place possible. I want to thank all of our members. Nearly 6000 of you. Let me rephrase that. We have that many members but i dont know how many are watching. Everything that you have heard about the present moment is true pretty we are facing significant financial strain right now along with some of the other sectors. We hope youll consider during this time, by making a donation. By clicking the donate button at the bottom of the screen or make a donation online town hall, 44321. As well. Meanwhile, our partner booksellers have been hit hard by the negative effects of the covid19 outbreaks. They could use your support as well. And of course deepening your understanding of the tonights topic a month hope you will consider purchasing the book. Okay. Tonights bio. I realized it sort of worked backwards in time. I really didnt take the time to change that. So working backwards, is presently a lawyer and politician. Previously democratic nominee the governor of ohio in 2018. For that he served as the first director of the Consumer Financial sector in 2012 2017. Athletic women, is hard Ohio State Attorney general. And treasure are pretty 2019, he received a Financial Service champion award. In the u. S. Small business administration. Earlier in his career, he was an adjunct professor in the college of law. And he served as a state rep. For the 33rd ohio house district. It was also the first general in the history. It he still, was the editor in chief of the lot review. His book, watchdog, protect the consumers can save our families, our economy and our democracy. As a subject its nice talk. Please join me in welcoming him. Richard thank you and thank you to everybody in town all for making this format available during these challenging times. Im glad to have the chance to be with you virtually and to talk about my new book watchdog. Watchdog is a story that is very timely to our Society Today into our Economy Today as we move into another financial crisis, we need to brace ourselves for the same types of problems we had seen before. The book is about consumers. Watchdog. Who are consumers. Everyone of us is the menu goes into the Financial Market place everyday makes decisions and choices and is out of the billions of decisions that we make everyday that the economy of the niceties of america more powerful, most affluent economy. The world is ever seen. When i started the book, wanted to start with stories about the average consumers. Uni in the people we know, our brothers and sisters and mothers and fathers and sons and daughters. I want people to understand is consumers often find challenging situations in the sometimes get into problems that are not of their own making. Some are but theres many situations where people are misled or cheated or mistreated in the Financial Marketplace. And i start with a variety of those. Im talking about people who are using products that will use like credit cards. Like auto loans. If youre buying a car or a truck. Like mortgages, by your house. Very few people by house in cash predict Student Loans increasing for so many families throughout this country. Trying to finance Higher Education for the children of the red children. And people running into problems and they often are stuck predict they dont know where to go or turn predict they often find that when theyre dealing with large companies, they get no response so they get the runaround and they often cannot get satisfaction. That is alienating and creates offensive disrespect produced widespread. We all know those feelings of being on hold for long periods of time and nothing can be done about that. For this or that reason and often varies in the fine print. So this in nature of consumerism. Its important to know were not alone. You may feel like you they only one who did not understand that are the only one who this happened. Credit card spending is ubiquitous among americans , auto loans are a big part of peoples lives where people drive to work. Mortgages are the way in which we buy houses and they are significant and Student Loans are a part of life and people can carry those loans for years. People have a lot more opportunity that credit provides its a bigger piece of the lives and this brings us to the financial crisis of 2008 that was widespread predatory mortgage lending causing many families to lose their homes affecting the entire economy this led to reforms to prevent that from happening again and it created as part of that reform and adf put forward by then professor, now senator Elizabeth Warren to protect consumers the straightforward analogy that was a leading argument for many that we are at a point it is basically impossible with a 20 percent chance to burst into flames and burn down their house that it was entirely illegal to sell them a mortgage with a 20 percent chance of putting them into foreclosure. That we were not providing protection for financial products. And then to focus on the big banks and Financial Companies themselves, making sure they foster over time. Thats important with Consumer Protection come it will not be good for any of the customers. At the same time its important for everyone to turn around 180 degrees and realize if they were mistreated in the marketplace something was wrong and we needed to rebalance the marketplace of consumers have the protection support that they need if we have strong consumers in our society we will have a stronger economy. And it is mortgage lending and the Consumer Finance market to upset the economy in 29 2009 2010. Its about Consumer Finance and how it has changed in the new Consumer FinancialProtection Bureau into protect people across america. Something thats important to realize as Consumer Finance has expanded in society so has the financial sector. Financial services is a bigger part of the economy and doubling in size and it is a staggering figure almost 40000 per person of Consumer Debt today and that the Financial Services industry especially in the quarters of power in washington theres more money spent on Campaign Contributions by the financial industry more than any other part of the economy. If you have that agency Whose Mission is to make sure the oversee the Financial Companies and hold them accountable for mistreating customers, there is bound to be significant push back. I told that political story in the book and the fight that preceded my time in washington and then that secondary complaint that developed and as the first nominee and as they battle to try to weaken the agency and then we come back later in the book where i talk about what it was like to serve almost all full year under the Trump Administration then to push for the agency to hold people accountable and the new Trump Administration has the regulatory mindset and talk about the battles back and forth. And then not doing the job that i saw and understood that john to be. And then to rebalance the marketplace to give consumers a louder voice in the economy. Its a young servicemember and his father. He went into the service and going into basic training and was leaving home for the first time and was going to be on his own for the first time. Those people are targets and financial creditors know that that these are unsophisticated naive and unexperienced consumers but a guaranteed paycheck from the us government. So then to congregate around military bases and has been described in as a seminar coming up stream to spine and with high cost loans and products especially electronics this is what happened he wanted like many young people who are now making money who wanted to buy the first set of wheels and found a lender that looked like a legitimate lender it all sounds very legitimate and when he walked out of the lender showplace he bought a used dodge ram truck it was costing him 70 percent of his takehome income. Some of that was undisclosed payments which is against the law, some that ways charged and didnt understand that. But that is what he was saddled with and for years to come most of the takehome pay would pay for the truck. Input deployed overseas he turn the finances over to his father and explained his situation and the outrage but when he tried to work with the lender he was a did he sign the paperwork . Yes he did case closed at the end of the story or so they thought and for many people like him he was stuck. His father did not let her rest he complained to everybody he could find and found his way to the cfpb and he filed a complaint with the bureau. Our folks investigated and they found the undisclosed fees any addon products that he was deceived in the marketing of those products brought enforcement action and we model that with the nationwide string of lenders and the same thing had happened with 50000 other servicemembers we brought that enforcement action and recovered millions of dollars back to the consumers who were harmed and to reform the terms of their contract we fix the problem for ari in the servicemembers that is the good work holding these lenders to account for going even one step further to understand the pattern of a problem and how to fix it. We found our he was told he had to have the loan come out of his military sally one salary Allotment Program so the lender got the money before it ever went to his account and he lost control of his own budget and could not prioritize payment that month if he preferred. The Allotment Program was created years ago as a convenience for when they were deployed overseas. Before the advent of Online Banking which is now so easy and convenient and debt collectors began using that system as a onesided collection to all requiring them to sign up and didnt realize that was an option. So they went to the pentagon and created a task force to work with us and ended up reforming the Allotment Program to make it illegal for high Cost Electronics and purchases for servicemembers. And then to provide the muscle and analyze the markets and with tens of thousands of others who were infected and a broader systemic problem. My point in the book, watchdog that the Consumer Bureau is emblematic of what we can do with it government when it is it focused on those at the top of the pyramid that focused on middle class and working class americans and we can put americans were consumers first to see that they get a fair shake. That something we need to do in Society Today and how democracy works. And how consumers can save not only the families and the economy by strengthening the backbone of the economy but also democracy giving people a stake to understand government can do something for them to make it better for them in the kind of structural change we could use across the entire government to make it as good as its people. I will take a break there and open up to the questions and answers sure you have a lot of questions talk about whatever you want including the Current Crisis affects current consumers or anything from the book or what i said tonight. Have added. At it. Hello. I am doing your video. We are waiting for questions and answers. The first question comes from kevin is there a way to change the perception as zero sound battle against business interest were consumers win and businesses must lose . Yes in fact i talk about this in my book the reality is when you create evenhanded oversight of the market as a whole and provide more protection for consumers somebody else gets the advantage and that is lawabiding businesses trying to do the right thing by customers that often have to compete against other businesses willing to cut, quarters and violate the law what happens when you are a Better Business like the Better Business bureau trying to do the right thing and suddenly somebody has an advantage by breaking the law . We either break the wall law with them or lose market share this happened a lot in the runup to the financial crisis there were responsible mortgage lenders losing out to irresponsible mortgage lenders misleading customers about a teaser rate and if it would remain over the life of the loan or other products that allow them to sell higher cost mortgages than the buyer by were deserved but the traditional lenders losing market share. Better oversight of the market better law and order actually serves the businesses dont have to compete against those. Thats one way its important but coming at of the financial crisis we need to restore confidence and understand it wasnt rigged i have confidence that they have a fair shake and a people dont have that confidence they will not participate and example is remittance transfers International Money transfers often to loved ones or family members if they dont have confidence in the market or the terms will be fair and they attacked the money into suitcases and it creates a black market if you create confidence and sensible set of rules that its better for the market as a whole not only for consumers but for the businesses to take that view and serve them a Strong Customer service. Do you have any concern the high Interest Rates permitted under state law like 12 percent in washington with prevailing rates are also low . There is borrower abuse that has to do with the sluggishness of legal changes in society. Those should be keyed to the going market rates. Right now 12 percent is when Interest Rates were much higher that was an unfair rate in a situation where the average market based bank account pays zero. 05 percent. That is the unfortunate aspect of the law that needs to be more nimble and cap uptodate and that is wrong. By the way the 12 percent Interest Rate which is high no question, pales in comparison to getting a payday loan or an online loan that is after one offered to triple digit Interest Rates i talk about the payday lending industry there was bitter fight that led to a rule we adopted for payday lending around the country to require them to make a reasonable assessment people can repay the loan before making the loan they thought that to the nail and under the current deal the current leadership is trying to undo the rule and that is the unfortunate direction i hope people will speak out against that but that will be tied up in the courts for some time many states have no payday lending the other two thirds are very high rates and then all states have the online loans find their way sometimes illegally but trap them in a cycle of debt. As a followup if anybody knows the story of Washington State better please correct me or add some detail in the questions, but washington had its own run with payday lending just a few years ago with a big push to regulate the industry. I remember being baffled at the time while a handful of legislators willing to fight so hard for industry was so aligned against the interests of their constituents. These were a handful of cases legislators who otherwise had strong track records of service to the underwater dog for the lack way to put it how has payday lending been able to develop the beachhead and legislatures around the country and hold on in the face where it has . A phenomenon ive seen around the country and there are two causes. The first there are a lot of legislators who are supported by the payday lending industry to Campaign Contributions and other means they been very effective to throw money around in the core doors of the legislatures in state capitals around the country but another part of this realistically there is an argument that having this credit available at high prices is somehow helpful to people i dont agree with that argument that the bureau did an analysis but what we found as soon as a trap people into cycles of debt with shortterm loans you thought you could repay it and you couldnt he would get stuck and pay fee after fee to repay the loan every two weeks and then pay more in fees than you ever borrowed. But they make the argument with a straight face that access to credit is a good thing even if that is terrible credit but it has such a high price with such conditions it ruins people financially and that was the problem i had with it the evidence showed that was true for a lot of borrowers. Is there anything the cfpb can reduce Interest Rates on Student Loans . It seems many people pay high rates and increase balance over time even with regular payments. I talk in the book with the difference of the Consumer Finance markets and how they differ from one another for example in the Mortgage Market the cfpb has Broader Authority to rein in bad practices and we were pretty effective at that. The same for the Mortgage Market was such it was difficult to think wed ever have a financial crisis for the same reason ever again now it comes into this pandemic crisis which is very different with more options available for homeowners to stay in their homes and defer foreclosures with better rules and mortgages out there and we safeguarded that to a significant degree to other markets we had a lot of trouble because of the authority was partial and not complete one was auto loans we had authority over lenders are not dealers they could carve the cars out because of the political muscles of you buy a car you often get it from the dealer not a lender directly and that made it difficult for us to address that market. The other a Student Loans we didnt have authority over students we had to work with department of education for federal Student Loans and a great relationship with the Obama Administration and worked effectively on these problems but then betsy devos came in and cut off that cooperation it hasnt been very Effective Work done for student loan borrowers to get into trouble managing that debt so the Interest Rate specifically that is a lot of has to be changed by congress to having good proposals in place even off the rates the banks themselves pay at the Federal Reserve discount window. Something like that needs to be done on the same principle about their Debt Collection statute and that should be brought up to date and keyed off of current Interest Rates. Thats a pretty good segue into the Trump Administration and the tech away the take away from the agency have seen so many lose everything what can you tell us what is happening with the agency right now . Good question we did a lot of work because the Mortgage Market is the biggest Consumer Finance market of them all and everything we were doing affected realtors and the way to make a living. The reforms we were putting in place to avoid ambushing buyers to be more satisfied and to have fewer regrets and problems after the transaction closes it was a big problem for those who get ambushed with new fees and problems but now they are stuck buying the house are selling the house without a lot of options and then to absorb the extra cost and then they are disgruntled. Take it or leave it. And then we saw that realtors like that because business is based on repeat business and for those that look forward to the next house purchase and arent worried they will get screwed for that technical legal term at the closing table so that is an important change that we made. But in terms realtors and others at the Consumer Bureau dealt with, we try to take a lot of input from them, we reached out to them a lot to understand exactly what challenges they were facing with the know before you roll mortgage rule to have more transparency around that transaction that turned out to be a very good thing for consumers. Who asked this question . So what do you expect to occur under the Biden Administration . And those to the Biden Cabinet any thoughts what that administration might hold . Vice President Biden was a strong supporter of the Consumer Bureau we worked with him on Student Loans and on the whole middleclass agenda during the administration i remember i talk about in the book a particular scene in which we were trying to help people and their families to better understand what decisions they were making to go off to college and about what loans they were taking on and how at the white house it was vice President Biden, secretary duncan and several universities around the country and vice President Biden talked poignantly about his own personal experience when he was getting ready to go to college and his fathers discomfort because nobody had gone to college and his father wasnt comfortable or familiar felt awkward about the situation when this is special about vice President Biden he hasnt lost that mentality to be a middleclass kid growing up in a middleclass family. He feels when he talks about these things it is personal to him he would be a strong supporter of the bureau one of my reasons for writing the book it is a roadmap to put the barrel back together for the Trump Administration if you dont hold people accountable they will edge their way and you need to do that that vice President Biden as president would feel and to have the privilege of advising on these types of issues. And its safe to say we dont know very much about and its daves question what are the three things the cfpb could be doing now in the wake of the coronavirus pandemic to protect consumers . Thats a great question. So two of my former colleagues with the white paper of the covid19 pandemic and how it affects consumers to be much more aggressive to protect consumers consumers are in distress many dont have money coming in they are not able to pay their rent at the hyatt the the auto loans for many people in many parts of the country and i talk about some of the things that can be done and i tweeted about this there is a white paper published but to answer your question what should they be doing . Right now number one it has tremendous access to realtime information. Most Economic Data comes at the lag it takes months to collect and analyze in very much behind. The Consumer Bureau has a public complaint database where they have their problems and issues day in and day out and to diagnose whats going on and to get that information for the rest of the government. Thats a they need to be doing number two on the customer finance if you let mortgage servicers off the hook. And then under the cares act and half the Mortgage Market is supposed to have access to forbearance if they cant pay their mortgage or payment this month or next month if they are not on the job, they are not answering the phone if they have a long wait times are follow through that will not get to people are middleclass families around the country. And then to make sure they are doing their job effectively. And then it is hard for debt collectors to collect on commission they dont get paid if they dont collect and the harassment and abuse will be magnified. We need to think about how we hold debt collectors accountable and the decent treatment of human beings who are the objects of activity those are three main priorities although there are 16 different issues in that white paper and its available. Through the internet. So with that band of questions how concerned or scared are you of the effectiveness of the cfp cfpb . Canned Biden Administration restored to full potency . This traces the dark itself. Because in the beginning the financial industry wasnt reconciled to the agency to hold them accountable. They started by blocking the nomination and to argue there should be reforms made to the agency. That was true from the outset and that progress goes all the way through. But as our mentality the right way to handle that is not to retreat and do nothing, but to show we are making progress and that the public see we are able to do things effectively to make them better off. We return 12 million to 30 million americans of the six years i was the director and that was important work they always have their lobbyists and lawyers on the job in washington but who is standing up for the other consumer . That was our job to do that. This is the roadmap i was trying to set and by the time i ended up stepping down to the end of my term under that leadershi leadership, by the end of the year or two even Nick Mulvaney it was a critic of the bureau and prejudice partisan critic, he begrudgingly and knowledged the bureau was here to stay and its an important part of the government. I believe that is true it is an important part of our government it can do more. It can do less. I believe it should do more but no doubt it will stay on the job. What we need is a Consumer Bureau standing of people , level the Playing Field so they have the benefit to have the law enforced that is important in our society. I put your rousing climax in the middle of the questions. But that is reassuring we see a Bright Future ahead if we can whether one whether this time. And i will refrain that. And with that Elementary School and the question was the one loosely about federal state and funding if the cfpb works at the department of education and if he could make any advances or have any impact with Public Schools attendees across the country. I will take that question in a particular direction Chapter Eight is all about personal finance education and incredibly important subject as they go through school and graduate and go out into the world whether that is the workforce and being responsible or college but they immediately confront decisions about student loan debt. And where do people get any guidance . And people get it at home not nearly as many as we would like somehow those bad lessons they have run into problems with before them. By the way in many homes theres not much that about finances because its a sore subject for a lot of parents. They are on the energy and fighting about staying afloat to make ends meet they dont want to talk about in front of their children. So i talk in the book how important it is a federal state and local level to promote financial education. What is the one subject the people need to know the matter what they know in my for the matter what career they had that is in science or social studies but personal finance. Whatever else they do avoid making big mistakes to put the best foot forward to provide for themselves and families we should do a better job 100 years ago where a lot of the map questions were all about economic decisions and in the household because of the agriculture economy but we need to recognize and all the other subjects and a standalone course so people can dig into this and understand it in every young person should have that education a federal agency because the curriculum at the state and local level for the United States. And for a federal agency it wasnt the Education Agency difficult to get people to listen. And Public Officials team up with us to promote this in their own state. Some are making progress. So it shows the United States is behind the other countries more in this area. If we keep at this for a number of years we will strengthen consumers, households will be stronger, they will be more solvent, have a Better Future and the economy will be stronger. We have many rousing climaxes. [laughter] is there a right balance of Consumer Education regulation and enforcement to protect consumers in the way that warren and dodd frank intended cracks that is a deep philosophical question and when you ask about what people intended so basically words on the piece of paper what the Consumer Bureau should be and its mission and objectives we turn that into something that was flesh and blood the agency built from scratch. And the massive nature of the undertaking we could of done it this way or that way. And i wanted this to what we were doing and why. And what choices we were making but what i would say is there are four main tools the bureau used education and improving disclosure some people have that clear sense theres a chapter of that on the book and regulation where we change the law and enforcement and supervision were compelling them to do things that they are not violating the law. The industry wants to push the regulators to more disclosure. That almost is a travesty and a caricature now is so much fine print people cant understand it at the 15th grade reading level but its actually much less enough for the average americans was designed not to be understood so they want to push the agencies in those directions we felt it was important to use all the tools so we call them on education and disclosure and raise them on enforcement and regulation to make sure those to be used as well. I cant bear to let the conversation and so given your experience in the tenacity that you show for those who do not want the agency to have a lunch with a career government officials treated and mistreated in washington. Do you have, is our governing class, the deep state going to be willing to come back into government after what we experienced . Are people willing to take on the hard challenges you took on to establish to rebuild a government in the wake of three and a half years of the dismantle . Thats a great question. On several aspects of response. The first is there is a lot of people in government and this should always be understood and people should understand a lot of people who are true Public Servants. They understand public power does the public good and then to be a Public Servant and do something that helps in society and makes things better for other people, i talk about my parents who works with the disabled for their careers it wasnt all that glorious of work or running for office, just getting up and going to work every day. Whether or not it was appreciated or understood , that was the job. That is what real Public Servants are about. People are just there to get a paycheck. Thats true with every walk of life and they deserve our support and respect. In the wake of the last three and half years, a period where the leadership of the federal government has not respected the government and has not tried to support the government so now coming into the crisis that was effective and timely and powerful to have it so we paid the price of the hollowing out of the government that has been so dramatic and illtimed and unfortunate. There is a lot of people with a Public Service mentality inching one itching to get back in their they are patriotic people who believe in america and know the government is not the problem its not the enemy thats what i talk about with the Consumer Bureau to help middleclass americans and thats what the government should be. The third piece of that is there is a lot of other dedicated Public Servants they are doing their donned darndest to make up for whats not happening in washington its best when we cooperate together when i was at the bureau in washington we worked closely with the state attorneys general and local officials and mayors on consumer issues and Financial Empowerment and the like. Even when that is not happening the state and local officials can pick up a lot of slack in doing that around the country. By the way cadre former cfpb people now in positions to make a big difference in their communities across the country. So im hoping it will still be attractive to serve out of a sense of duty you are describing that people are receiving right now. Especially in the other washington. The representatives are aligned with your thinking what else can i do to help make positive changes for consumers . Its a good question. Goes back to be a good citizen of the country an activist. Your Voice Matters you can speak up and speak out and be supportive. And help get visibility to this book it creates more awareness and a groundswell of support for that agency not only to exist but do the job the way it is supposed to and provide a groundswell of support for Public Servants across the country so when you have a problem of finances or credit file a complaint with the Consumer Bureau. Many people do that 30000 each month and that gives a birds eye view of the community and the data but the voice of the consumer funneled right into the middle of the agency and to know what we should do to address the problems of people around the country so political advocacy and Political Support and an awareness of why this is so important and that matters enormously. It makes a difference every time people would say to me that when we get money back for people they were uncertain what this was if a god check in the mail from cfpb they never heard of the were contacted thinking it was a scam and we were happy to reassure them this is one check they should cash and we were on the job trying to work for them. People are always surprised to get the money back and that somebody had done a lot of work and went to the trouble to make that happen. So these are bona fide so im assuming that was a complaint lodged through another channel it found its way and then to circle back and in a way you didnt even know they were working on your behalf. And the irony of these members of congress who would complain loudly and send those in private to work them out. Some things never change. Mr. Cordray thank you for your service its helpful for those who want to serve in your passion on the other side of what we are enduring right now. I want to urge everybody who listen tonight to pick up a copy of watchdog and get the rest of the story. And to be a statement of those values enshrined in the agency are things that matter to us as consumers and as citizens of the country. Also thank you for making the program technically possible tonight and i urge you to join us tomorrow night in conversation thank you again and we will speak with you very soon. Into the car and into the everglades and that is an adventure and its dangerous and theres alligators and people can die that they knew better. And there was a monsoon, there were snakes and alligators and they fled but they like to the idea. It came about they would take a trip once a year with a little better planning. Great to be with you michelle lets get ready to talk about your book. First part of your but captured my attention thats important to me as a congressman from texas that cartels have operational control of the border and then to the border numerous times and like to get your perspective the 2 million per week of the golf one the cartel is making you know this well its a real problem