Now that the Presidential election is over, we can turn our attention to how a second Trump administration could impact consumer financial services. President Trump's first term focused on deregulation and reducing the regulatory burdens on businesses, and we expect that this will again be an emphasis in his second term.
It is a certainty that Rohit Chopra will not continue to lead the CFPB for long once President Trump takes office. In his first administration, Trump first appointed two Directors who drastically cut back on the Bureau's enforcement actions and fines. We expect to see a similar direction from the new Director. The CFPB has spent the last few years adding to its numbers of enforcement attorneys, so it will be interesting to see what happens with staffing.
The direction of the FTC is a bit harder to predict, because Vice President elect Vance is said to be a fan of Chairperson Lina Khan, though we expect a new Chairperson that is not as aggressive. The fate of the Cars Rule (Vehicle Shopping Rule) is uncertain, though it would be surprising to see the FTC continue to aggressively seek its implementation in a climate of less regulation.
Timing plays a large role in all of this, because although President Trump may get to an interim CFPB Director and FTC Chairperson quickly, it can take several months for Senate Confirmation, and during that time there may be little to no action taken. It may be until late spring or early summer before we get a better indication of the true direction of each regulator.
Don't break out the champagne yet, though, because eight years ago we saw many state regulators step in to fill the vacuum caused at the federal level, and increased state regulatory scrutiny and more aggressive examinations followed. Many consumer advocates and Attorneys General (Aspiring Governors) favor some of the concepts of the Cars Rule, particularly the offering price and express informed consent provisions, and it wouldn't be surprising for those to take hold at the regulatory and even legislative levels.
Based on all of this, our Tip of the Week is to remain vigilant, continue to be transparent in dealings with consumers, and protect your business by following the concepts and methodologies we publish each week
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