CFPB – The Crumbling Nemesis and an Elephant on a Rope

Reflecting on the CFPB’s Demise; What Changed, What Will and What Should Change in the Repossession Industry

EDITORIAL

2011 seems like decades ago, but in the mere fourteen years that have passed, the Consumer Financial Protection Bureau (CFPB) became an unfettered tyrant of self-interpretive compliance. Billions of dollars in fines were doled out on lenders with little due process and their “Findings” became the law of the land that reshaped the repossession industry for the worse. Fast forward to 2025 and as we watch this bogey man being disassembled by the Trump administration, what changes to the repossession industry can be expected?

Inception

In 2011, the CFPB opened under the Obama administration with a staff of about 757. Over the years it grew to over 1,700. During the years of its operation, it has pursued dozens of enforcement actions against auto lenders, with fines totaling hundreds of millions of dollars.

The simple suggestion that the CFPB opposed anything was enough to get lenders, supervised by them or not, to jump through any imaginable hoop of fire. But of course, those lenders forced their fears of the CFPB on to the repossession industry.

What’s followed has been fourteen years of the repo industry bowing to every suggested compliance measure and the prohibition of hard-earned revenue streams. This quasi-compliance bogeyman has caused the loss of perhaps millions to the repossession industry and offered nothing in return.

2025 – The Dismantling

So, here we are in the year 2025 and President Trump has decimated the CFPB. Dismantling it from its peak staffing of about 1,700 to about 200, they clearly aim to shut it down. Whether or not is closes permanently, time will tell. But as they fade away into obscurity for the foreseeable future, what changes can be expected for the repossession industry going forward?

That’s a question in itself, but first, let’s look at what has changed since their inception.

The Umbrella of Restriction

Once the CFPB came into power, lenders became stricken in fear. Overcorrecting minor issues using the justification of “consumer protection” as the basis for withholding and denying fees that should rightfully be paid to the agency by the lender, NOT the consumer.

Lenders began to adopt the mindset of excessive risk aversion for their own benefits, and the development of an umbrella structure took place. This structure became one of restrictions and punishment against agents to benefit their own positions. Covering every expense or compliance question, they used the CFPB as an umbrella reply to anything they preferred not to do or pay for.

In short, the CFPB’s actions opened the door for lenders to claim they couldn’t charge the consumer and therefore claimed that they couldn’t or simply wouldn’t pay the agents, creating a loophole that’s done lasting damage to the repossession industry.

It’s time to call it what it is……exploitation disguised as compliance.

Personal Property – As the greatest example of this umbrella excuse is the lending world’s response to the CFPB’s finding that it is unfair that consumers should have to pay for the inventory, removal and storage of their personal property after recovery.

Lenders immediately adopted it as meaning that agents can’t get paid for it. But that’s not what they said, they said they didn’t believe it was the consumer who should pay. Rather than understanding the loss of income and time for the repossession industry and paying fees for this themselves, they simply refused to let agents charge for it even when it was well codified in state laws!

This time consuming, dangerous duty has gone uncompensated for over a decade now.

Standardized Repossession Fees – Go all the way back to 2016, the CFPB’s mandate of standardized national pricing of repossession fees really took root. This ludicrous notion that in fairness to consumers, all repossessions should cost the same no matter what city or state came into effect.

Back in 2016, agency owner Ed Wolmers wrote an interesting article of this titled “Standardizing Rates or Unfair Price Fixing!” It’s worth a revisit.

This ridiculous demand, still held by lenders, severely penalizes all agencies in states plagued by high gas prices and taxes.

How is it possible for a repossession company in high property value cities like New York, Los Angeles or Chicago to operate at the same price point as an agency in a rural Texas city let alone one in the Midwest? It’s not.

Regardless, it favors the lenders and it has become the national standard of negotiation by every agency and forwarder. This practice offers no offset compensation to agents in high expense areas and sucks away at their profitability like a tick on a dog’s ass.

Complaint Response Compliance – Every single duty added to the flat and stagnant repossession fee is another “Time Vampire” sucking away from efficiency and profitability. Complaint management processes and procedures are another one of these knee jerk reactions to CFPB overreach. Regardless, everyone jumped on board as the lenders demanded.

How many hours, days and weeks have agencies spent on developing, implementing and maintaining these? And for what? So that the lenders could go to the CFPB and tell them that everyone who works for them is in compliance.

What for? What was the point? They were going to complain about being repossessed anyway. Was it really at all helpful to capture these and make lenders respond to them, which of course also required agencies to feed into the process.

It’s a repossession; not many consumers are going to have neutral or positive emotions about it. What did the CFPB expect? Nothing really, they merely wanted to use it as a truncheon to threaten their supervised lenders with.

Once shuttered, will the consumer continue to have the ability to fill out the CFPB online consumer complaint form? Who’s going to respond to them? The National Consumer Law Center’s (NCLC) proclaimed “Queen of the CFPB” Elizabeth Warren? I doubt it and doubt that she will be around long enough to resurrect the stinking corpse of a legacy that this agency will become.

Everything Else – The CFPB was a wrecking ball on an industry that was already struggling. Their omnipotent reach has caused great hardship for all in more ways than can be counted.

Through this bureau, both the lending and repossession world have allowed fear of oversight to become their primary operating principle.

Here we stand 14-years into their sanctimonious reign staring at the withering, rotting nemesis that was the CFPB. Is it dead? No, not really, but it does seem to be a toothless lion at this point.

So, now that they’re going away, what’s next? So, where does everyone go from here?

Will lenders and agency owners continue to cling to the CFPB’s rulings and opinions as though they are still the law of the land? Some courts may still hold these rulings as valid for many years to come. It seems unlikely that they will look for change, especially if there is no direct benefit to them or any resistance to the status quo.

But truth be told, nothing will change. That is, nothing will change under the current mindset.

Elephant on a Rope

After fourteen years of living under the lender’s umbrella of restriction, perhaps this is time for the repossession industry to seriously push back. For far too long, the industry has been acting like the parable of an “Elephant on a rope.”

This parable refers to a young elephant tied by a rope to a post that it can’t break free from, eventually leading to the adult elephant believing it cannot escape, demonstrating learned helplessness and the power of self-imposed limitations. This story highlights how past failures and mental blocks, or “invisible ropes,” can prevent individuals from reaching their full potential.

Consider how these learned behaviors have influenced the industry. The CFPB was that rope. Don’t expect the lenders to just step forward and say “Hey, now that the CFPB is crumbling away, we’re going to let you charge personal property fees and charge more for repossession fees in states with higher taxes and gas prices!” Dream on, it ain’t gonna happen like that.

The question is: why should agents remain conditioned to servitude under rules that no longer exist?

New Conversations

If anything is going to change, it will require that the repossession industry changes. It will require unity and the fortitude to say what they want and to simply refuse to work for less than it deserves.

New conversations need to happen. New horizons need to be explored. Unfettered by illogical and unfair judgement from bureaucratic and politically motivated paper lions hidden in the crystal puzzle palaces of Washington DC, there needs to be a new awakening by both lenders and the repossession industry.

There are two national repossession associations, the Eagle Group XX and sixteen state repossession associations. The industry is more united and organized than probably ever. Relations between the repossession forwarding companies and lenders are probably the best they’ve ever been. New conversations need to begin.

But the repossession industry is not the only “Elephant on a Rope.” The lending world has a rope of their own holding them back. “The CFPB said this, the CFPB said that…” Those are the expected excuses lenders will continue to use. But very soon there will be a new reply; “There is no more CFPB.”

Lenders, Repossession Industry, are you ready to take control of your future or are you simply going to continue to operate in helplessness and self-imposed limitations like in the last decade or more?

The choice is yours.

Kevin Armstrong

Publisher

CFPB – The Crumbling Nemesis and an Elephant on a Rope – CFPB – The Crumbling Nemesis and an Elephant on a Rope – CFPB – The Crumbling Nemesis and an Elephant on a Rope –