Which of the following best represents the role of the Consumer Financial Protection Bureau?

• A. Regulating consumer financial products and services
• B. To eliminate subprime lending
• C. To provide market tools to help consumers limit losses on stock investments
• D. To insure that every consumer is properly educated about financial investments including stocks, bonds, mortgages, etc

Answer: (A)

The Bureau’s job is to regulate consumer financial products and services to protect people from unfair, deceptive, or abusive practices and to ensure clear, accurate disclosures. It writes and enforces rules for mortgages, credit cards, student loans, payday loans, and other consumer financial products, and it supervises both banks and certain nonbank lenders to ensure compliance. It also handles consumer complaints and collects data to monitor market practices. This focus on safeguarding consumers in the financial marketplace is what defines its role.

Eliminating subprime lending isn’t its primary aim, even though its regulations can influence underwriting standards. Providing market tools to limit losses on stock investments falls under securities regulation handled by other agencies, not the CFPB. Guaranteeing that every consumer is educated about all financial investments is broader than the CFPB’s mandate, which includes education efforts but not universal, comprehensive investment instruction.