By Matt Egan, CNN
New York (CNN) — The Consumer Financial Protection Bureau abruptly dropped cases on Thursday against multiple companies that had previously been accused of hurting consumers.
Court filings indicate that the consumer watchdog has decided to dismiss lawsuits previously filed against Capital One, Rocket Homes and a student loan servicer. Just weeks earlier the CFPB accused Capital One of “cheating” millions of customers out of billions of dollars of interest payments.
The decision to abandon the cases demonstrates the hands-off approach to regulation from the Trump administration, which has scrambled to sideline the CFPB in recent weeks in an effort led by Elon Musk’s Department of Government Efficiency (DOGE).
Trump-appointed officials have ordered staff to halt all work – including fighting financial crime. Now the CFPB is dropping multiple cases it had previously pursued.
“The most important consumer financial watchdog is no longer on the beat,” Christopher Peterson, a law professor at the University of Utah and former CFPB official, told CNN in a phone interview. “This means that major corporations who have ripped off ordinary working people are going to get away scot-free.”
The moves come the same day as Jonathan McKernan, President Donald Trump’s pick to head the CFPB, faces questions from US senators during a confirmation hearing on Capitol Hill.
In a Thursday filing in US District Court, the CFPB filed a notice of a voluntary dismissal of its lawsuit against Capital One.
It’s a dramatic shift from January 14, when the CFPB, then led by former President Joe Biden-appointed officials, sued Capital One for “cheating millions of consumers” out of interest rate payments. Regulators accused Capital One of failing to pay more than $2 billion in interest to holders of its high-interest savings accounts – a claim that the company denied.
“The CFPB was created to be a watchdog for big banks, not a lapdog, and dismissing this case is a gift to Capital One,” Erin Witte, director of consumer protection at the Consumer Federation of America, said in a statement.
A separate filing Thursday indicated the CFPB voluntarily dismissed a case against Rocket Homes, a unit of Rocket Companies, and The Jason Mitchell Group real estate brokerages.
In December, the CFPB had accused the group of an illegal kickback scheme to steer mortgage applications to Rocket.
Shares of Capital One and Rocket Companies climbed more than 1% Thursday morning, even as the S&P 500 dipped slightly.
In a third filing, the CFPB on Thursday dropped its case against Pennsylvania Higher Education Assistance Agency, a student loan servicer that does business as American Education Services, or AES.
In May, the CFPB sued the student lender, alleging it hurts student borrowers by failing “to recognize that some private student loans are discharged in bankruptcy.” As a result, the CFPB said, some borrowers paid thousands or even tens of thousands of dollars on student debt they did not owe.
The decision to drop cases was foreshadowed by the fact that the CFPB recently canceled contracts with multiple expert witnesses it had hired in cases against companies accused of hurting consumers.
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