In December 2016, the Consumer Financial Protection Bureau produced a study that was useful for the university administrators looking after millions of college students in the United States.
In an annual report to Congress, the agency published an analysis of agreements between credit and debit card issuers and institutes of higher learning—one that included warnings about boilerplate deals enabling banks to ply fees out of students.
“Many general marketing agreements contain features or lack protections that may make them inconsistent with the ‘best financial interests’ of students,” the report warned in boldface text. The agency noted these deals “do not expressly prohibit certain fees,” and stressed that “colleges may negotiate…to include additional key consumer protections.”
Since the Trump administration took power, however—under the leadership of interim CFPB Director Mick Mulvaney—the tenor of the report changed drastically. Last year’s version, published in January 2018, reads more like it was written the night before. The paper has updated quantitative data, little qualitative analysis and no discussion of overdraft charges.
A university that takes a hands-off approach to debit and credit card deals could see its student body incur “hundreds of thousands of dollars in fees per year,” according to the 2016 version of the report.
The Bureau’s approach to reporting on colleges and banks under Mulvaney led a career official to quit earlier this week. Seth Frotman, Student Loan Ombusdman, said the CFPB is currently “shielding bad actors from scrutiny” in a resignation letter obtained Monday by NPR.
“[L]ate last year, when new evidence came to light showing that the nation’s largest banks were ripping off students on campuses across the country by saddling them with legally-dubious account fees, Bureau leadership suppressed the publication of a report by Bureau staff,” Frotman said.
The outgoing official didn’t reveal which banks were allegedly being protected by Mulvaney. According to Bureau data, however, the largest Wall Street players in the market for student cards are Bank of America and US Bank—the second and fifth largest banks in the country by asset size. The latter paid $19.1 million last year to maintain agreements with 81 colleges; the former had 10 agreements in effect worth $2.1 million.
Bank of America donated more than $20,000 to Mulvaney’s campaigns while he served as a Congressman, representing South Carolina’s Fifth District. US Bank gave $5,000 to Mulvaney throughout his legislative career. While the size of these gifts wouldn’t cause most in Washington to bat an eyelash, earlier this year, Mulvaney openly admitted to favoritism for political donors while serving on Capitol Hill.
“We had a hierarchy in my office, in Congress,” he told banking lobbyists in April. “If you were a lobbyist who never gave us money, I didn’t talk to you. If you were a lobbyist who gave us money, I might talk to you.”
We’re not backing down in the face of Trump’s threats.
As Donald Trump is inaugurated a second time, independent media organizations are faced with urgent mandates: Tell the truth more loudly than ever before. Do that work even as our standard modes of distribution (such as social media platforms) are being manipulated and curtailed by forces of fascist repression and ruthless capitalism. Do that work even as journalism and journalists face targeted attacks, including from the government itself. And do that work in community, never forgetting that we’re not shouting into a faceless void – we’re reaching out to real people amid a life-threatening political climate.
Our task is formidable, and it requires us to ground ourselves in our principles, remind ourselves of our utility, dig in and commit.
As a dizzying number of corporate news organizations – either through need or greed – rush to implement new ways to further monetize their content, and others acquiesce to Trump’s wishes, now is a time for movement media-makers to double down on community-first models.
At Truthout, we are reaffirming our commitments on this front: We won’t run ads or have a paywall because we believe that everyone should have access to information, and that access should exist without barriers and free of distractions from craven corporate interests. We recognize the implications for democracy when information-seekers click a link only to find the article trapped behind a paywall or buried on a page with dozens of invasive ads. The laws of capitalism dictate an unending increase in monetization, and much of the media simply follows those laws. Truthout and many of our peers are dedicating ourselves to following other paths – a commitment which feels vital in a moment when corporations are evermore overtly embedded in government.
Over 80 percent of Truthout‘s funding comes from small individual donations from our community of readers, and the remaining 20 percent comes from a handful of social justice-oriented foundations. Over a third of our total budget is supported by recurring monthly donors, many of whom give because they want to help us keep Truthout barrier-free for everyone.
You can help by giving today. Whether you can make a small monthly donation or a larger gift, Truthout only works with your support.