The Consumer Financial Protection Bureau last year sued four lenders affiliated with a Northern California Native American tribe, alleging their costly loans violated interest rate caps in more than a dozen states.

The enforcement action came amid a probe into yet another high-interest lender, World Acceptance, which the federal watchdog was considering accusing of consumer-protection law violations.

Months later, the agency issued tough regulations aimed at reining in the practices of payday lenders, including limiting the number of costly short-term loans they can offer to cash-strapped Americans.

But since the start of this year it’s been a different story.

The bureau asked a federal judge in Kansas to dismiss its case against the tribal-affiliated lenders, ended its investigation of World Acceptance and said it may reconsider its payday-lending rules.

Welcome to the new CFPB under White House budget chief Mick Mulvaney, appointed by President Trump in November to temporarily lead the bureau after the departure of Obama appointee Richard Cordray.

Scott Pearson, a partner at law firm Ballard Spahr who represents financial services companies, said he expects the bureau will focus on cases in which firms are accused of practices such as overcharging customers or charging illegal fees.

That could leave the door open to more actions like the one the CFPB took in 2016 against Wells Fargo & Co. The bureau and other regulators fined the San Francisco bank $185 million for opening checking, savings and credit card accounts without customers’ authorization.

People

Related Practice