Fines Might Not be Enough: CFPB’s Chopra

In an interview last week, Rohit Chopra, the Director of the Consumer Financial Protection Bureau, pondered whether assessing fines is enough to deter illegal behavior in the financial services industry, saying that the Bureau will “continue to seek new remedies” to ensure companies meet their responsibilities and obligations.

Chopra has been on the interview circuit recently, first speaking with American Banker and then conducting a video interview with Associated Press.

In the interview with AP, Chopra said that some companies that are now offering financial services products, like Apple, for example, are so big that fines might not be “sufficient to punish bad actors.”

Some potential options including placing limitations on a company’s growth — similar to what the Federal Reserve did with Wells Fargo in the wake of its fake accounts scandal several years ago — or even banning companies from being able to open new accounts or take on new business, as well as going after individuals instead of just companies.

The CFPB has already embarked on that last option, naming an individual in a lawsuit that it filed earlier this year against TransUnion, accusing it of violating an earlier consent order.

“We’re shifting our enforcement focus to these larger actors who knew something was a violation of the law but made a calculated decision to violate that law,” Chopra said in the interview.

Chopra made similar remarks a day earlier when he announced an enforcement action against a mortgage company for allegedly engaging in redlining by not making loans in certain areas. “We will continue to seek new remedies to ensure all lenders meet and fulfill their responsibilities and obligations,” Chopra said.

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