Who Needs Consumer Financial Protection?
Households and communities with low incomes, and particularly communities of color, have long been targets of fraudulent and predatory financial products and services. Largely unregulated products and services with deep histories of consumer abuse such as payday and auto title lending, debt collection, and paid tax preparation are pervasive and regularly result in cycles of increasing debt and greater financial instability around the country.
In fact, nearly a quarter of all U.S. households have used at least one high-cost alternative financial product such as check cashing, payday loans, or title-pawn loans. In addition, a quarter of households have dealt with debt collectors, many of whom operate without basic standards of practice regarding accuracy of information or appropriate collection behaviors.