Senator Elizabeth Warren (D-MA) has accused the acting head of the Consumer Financial Protection Bureau (CFPB) of contradicting President Donald Trump's efforts to reduce credit card costs. According to a letter to acting CFPB Director Russell Vought, obtained exclusively by CNBC, Warren criticized the agency's recent decisions to remove a rule limiting credit card late fees, align with lenders in lawsuits involving deceptive practices, and halt enforcement actions against the industry.
Earlier this month, President Trump urged U.S. banks to voluntarily cap credit card interest rates at 10% for a year via social media. Following inaction, he encouraged lawmakers to pursue legislative measures. Warren highlighted her conversation with the President, mentioning her proposal for Congress to pass rate-capping legislation with his support.
In her letter to Vought, Warren stated, "While Congress considers legislation to address the issue, your own actions are directly undermining the President's stated goals." She accused the CFPB, under Vought's leadership, of making it easier for banks and credit card companies to exploit consumers.
The letter emphasizes Warren's strategic move to use Trump's affordability agenda against his administration, exacerbating tensions surrounding the CFPB—a regulatory body she helped establish during the Obama era. Trump's administration has reportedly aimed to dismantle the CFPB as part of a broader deregulatory initiative.
Current and former CFPB employees allegedly view the agency as weakened under Vought, who has sought court approval for mass layoffs and defunding. An agency spokesperson claimed the Dodd-Frank Act prevents the CFPB from imposing credit card rate limits.
Warren urged Vought to leverage the CFPB's authority to combat excessive credit card costs and unethical actors, rather than dismantle the agency. She insisted that the CFPB should "immediately reinstate its rule capping credit card late fees at $8"—a move estimated to save Americans over $10 billion annually.
Warren also pushed for actions against deceptive deferred interest promotions, renewed enforcement of interest rate monitoring, addressing consumer complaints, and eliminating rewards program bait-and-switch tactics.
She concluded with a pointed remark: "Either President Trump is not serious about making credit cards more affordable or you are insubordinately disregarding his direction," Warren wrote.