Witnesses and members criticize CFPB staffing changes and dropped enforcement actions

Members of the House subcommittee and consumer advocates criticized recent changes at the Consumer Financial Protection Bureau (CFPB), saying staffing reductions and dropped enforcement actions have reduced protections for fraud victims.

Carla Sanchez Adams, senior attorney at the National Consumer Law Center, described payment fraud as a “national crisis” and said legal protections vary by payment method. She told the committee that unauthorized transactions are covered by the Electronic Fund Transfer Act (EFTA), but that EFTA does not clearly protect many newer payment methods and fraudulently induced transfers. Sanchez Adams urged Congress to modernize EFTA to cover fraudulently induced transfers, noting the UK’s reimbursement approach as an example.

Ranking Member Greene and other Democratic members sharply criticized the current CFPB leadership and cited recent dropped enforcement actions. Rep. Maxine Waters said the bureau under its current leadership “dropped a lawsuit” involving Zelle and another involving Cash App, leaving state attorneys general to pursue those cases. Sanchez Adams confirmed that some suits were picked up at the state level and that redress ordered in prior consent decrees has not been fully distributed to consumers.

Witnesses and members discussed private remedies, including the EFTA’s private rights of action and industry remediation programs, but several witnesses warned that many victims cannot afford private litigation and rely on agencies for enforcement. Kate Griffin said victim reporting is concentrated to financial institutions rather than law enforcement, and Paul Benda and others called for improved agency coordination and continued supervision of emerging payment products.

No formal policy change was adopted at the hearing; members asked for follow‑up written responses and said they would consider legislative fixes to restore or clarify consumer protections.