Blumenthal Seeks Improvements to Consumer Protection Shortfalls in Senate Banking Bill
[WASHINGTON, DC] – U.S. Senator Richard Blumenthal (D-CT), Ranking Member of the Senate Subcommittee on Consumer Protection, Product Safety, Insurance and Data Security, introduced three amendments to the Economic Growth, Regulatory Relief, and Consumer Protection Act to address several consumer protection deficiencies in the bill. Blumenthal’s amendments include language to protect basic employment rights for servicemembers and veterans, strengthen existing student loan forgiveness programs for public servants, and ensure that vulnerable consumers do not fall prey to unscrupulous auto lenders. The Senate will vote on final passage of the bill in the next week.
“In its haste to help big banks, Congress is considering a roll back of Dodd-Frank protections for consumers. It is essential we commit to protecting vulnerable consumers who stand to lose the most from a financial meltdown,” said Blumenthal. “My amendments would fill some of the gaps in safeguards and financial relief for Connecticut veterans, workers, and families. My proposed improvements allow unjustly fired or exploited servicemembers and veterans to have their day in court. I’ve introduced an amendment that eases student debt burdens of public servants – police officers, teachers, and healthcare workers who make personal make personal and financial sacrifices. And I have proposed a measure to curb predatory auto lenders from targeting vulnerable consumers.”
The bill rolls back restrictions on the nation’s biggest banks, and weakens government oversight of financial institutions. It also fails to address ongoing consumer abuses, such as the Equifax data breach or the Wells Fargo forced-placed insurance scandal. In an effort to improve the legislation, Blumenthal has proposed three amendments to the bill that are outlined below.
Protect basic employment rights for service members and veterans: This amendment is based on Blumenthal’s Justice for Servicemembers and Veterans Act, which would strengthen the Uniformed Services Employment and Reemployment Rights Act by ensuring that employers cannot use pre-dispute arbitration agreements to escape accountability.
Ease student debt for public servants: This amendment, modeled on Blumenthal’s Strengthening Loan Forgiveness for Public Servants Act, enhances the student loan forgiveness program for teachers, police officers, public health workers and others who dedicate their careers to public service. The Public Service Loan Forgiveness Program (PSLFP) currently provides student loan forgiveness after qualified borrowers make 120 full, scheduled, monthly payments while employed full-time in public service. Blumenthal’s amendment would allow new PSLFP participants to defer their eligible Direct Loans while they work in public service and receive loan forgiveness in proportion to their years of public service – after every two years, they would have a certain percentage of their eligible balance cancelled.
Protect consumers from unscrupulous auto lenders: This amendment directs the Federal Trade Commission (FTC) to establish rules that prohibit auto dealer interest rate markups, end yo-yo scams, curb loan packing, ban pre-dispute arbitration clauses in dealer contracts, and implement steps to ensure that dealers do not cause harm to consumers when the dealer closes. Frequently auto dealers take advantage of vulnerable consumers – specifically targeting non-English speakers and those with poor credit – with a variety of predatory and discriminatory lending practices.