CFPB

Cordray Tells Bank CEOs To Give More Control To Consumers

Although he is due to resign next week, Richard Cordray, the director of the Consumer Financial Protection Bureau, still wants his opinion to be heard.

According to American Banker, Cordray sent a letter to 29 chief executives at banks, credit unions and other financial companies, urging them to help consumers have more control over credit cards, debit cards and other payment methods.

“On the eve of my leaving the bureau, I urge you to think creatively about how you can put more control directly in the hands of your consumers,” Cordray wrote. “This will help them as they worry about data breaches, and could help you minimize the incidents of fraudulent use of credit cards and debit cards and other payment methods.”

While banks and FinTech companies are working to strengthen security and protect consumer data after the massive Equifax breach that compromised the personal information of more than 145 million consumers, Cordray has also urged these CEOs in the past to create bank accounts without overdraft features, or to regularly share credit scores with consumers.

“There is enormous value in new technology that makes it feasible, right now, to enable consumers to exert much greater control over their credit cards, debit cards and other payment methods,” he wrote.

Cordray wrote that his suggestions, which are not considered regulatory guidance, would result in lower chargeoffs. He also noted that digital servicing platforms help to discourage fraud.

“Such platforms can allow consumers to exert greater control on their own spending and those they authorize to use their accounts by establishing settings that limit how, where, when and to what extent their accounts are accessed — and to do so much more easily and conveniently,” Cordray wrote. “I believe your customers will want and demand this capability, and it is worth considering how you can prioritize the steps necessary to speed its availability to them.”

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