CFPB Director Richard Cordray and Chicago Mayor Rahm Emanuel announced on Wednesday that they had reached an information-sharing agreement intended to protect Chicago consumers from financial fraud.
“We want to learn from and expand on the ways you protect consumers, and to share these approaches nationwide,” Cordray said. “We also want you to be able to take advantage of the new resources we bring to the arena, including strong analytical tools and a broad mandate to protect consumers against illegal practices.”
Chicago will be the first city to directly report financial activity and financial misbehavior to the watchdog agency, and the CFPB is encouraging other cities to do so, as well. The agreement is intended to allow the CFPB to detect early fraud patterns involving payday lenders and other financial firms and take the necessary enforcement action against offenders.
“We must use every tool available to us to protect responsible working families from businesses that make their profits through financial fraud and scams,” Emanuel said. “These tools will enhance Chicago’s efforts to stop the scams and fraud before they can claim a victim.”
Chicago has taken several actions to protect consumers, including a new city ordinance to regulate and license debt collectors, information-gathering related to predatory and deceptive financial products, new zoning regulations to limit the growth of payday lenders and other financially predatory firms, and a new city ordinance strengthening the Chicago Department of Business Affairs and Consumer Protection’s ability to prosecute firms that violate the law.