CFPB Announces Enforcement Action Against Capital One
The Consumer Financial Protection Bureau is the brainchild of Massachusetts Senate candidate Elizabeth Warren.
WASHINGTON -- The Consumer Financial Protection Bureau announced its first enforcement action Wednesday morning, targeting Capital One for deceptive marketing tactics.
Roughly two million Capital One customers will receive a full refund, the agency said, at a cost of $140 million to the financial institution. Under the settlement, Capital One is also required to pay $25 million to the CFPB. Consumers due refunds need take no further action. If they are still Capital One customers, the money will be credited to their accounts. If they're not, a check will be sent their way.
The action could have a collateral benefit for the godmother of the agency, Elizabeth Warren, who is now running for the U.S. Senate in Massachusetts. Warren is credited with laying the intellectual foundation for the CFPB, fought to include it as part of Wall Street reform legislation, and was named by President Barack Obama to staff and set up the bureau.
Opposition from banks, from Republicans and from within the White House prevented her from winning a permanent appointment to run the bureau she created, but many of its senior officials remain loyal to her and to her vision for it.
The enforcement action now raises the CFPB's profile, thereby reminding voters in Massachusetts about Warren's consumer-friendly background, which she regularly contrasts with that of her opponent, incumbent Republican Sen. Scott Brown, whose support on Wall Street runs deep. Brown even has a separate political action committee geared primarily toward raising cash from bankers.
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07/18/2012