In February of this year a House Financial Services Committee took place. The goal of this hearing was to examine the treatment of Native American Tribes at the hand of the Consumer Financial Protection Bureau (CFPB.) A major leader of the Native American community suggested that Congress should once again stand in solidarity with the Native Americans in this country to help make sure that the CFPB respects the relationship between the U.S. government and Tribal government bodies with regards to any rules that are going to be implemented to further regulate the payday lending industry.
Chairperson of the Habematolel Pomo of Upper lake, Sherry Treppa made an emotional testimony to demonstrate how much her own tribe has had to suffer, and how they have managed to survive throughout time by fending off threats to their wellbeing and making a way for their people to be financially self-sufficient. Chairperson Treppa indicated that the decision the tribe made to get into the online short term lending industry has done nothing but strengthen the tribe, and has allowed it to revitalize their economy, educational programs and even important social services that reach the most at-risk members of the tribe.
Now multiple tribes, just like that of Treppa’s are staring directly at the potential for a new threat to their economic freedom and way of life. This threat comes in the form of the CFPB getting ready to announce new rules that apply to the payday lending industry; rules that may very well wind up ignoring the strict regulatory foundation that tribes (working together under the Native American Financial Services Association – NAFSA) have worked diligently to put in place in order to protect consumers. Chairperson Treppa made a call to the CFPB to give credence to the huge amount of work that these tribes put into creating these regulations, and the finished product of regulations that protect all parties involved.
Chairperson Treppa said, “In contrast to our experience working with other federal agencies as well as state and local governments, the CFPB has refused to engage in a meaningful dialogue about our shared interests and so far has shown little interest to work together, where necessary, as co-regulators. I remain concerned that the CFPB is developing its proposed action in a vacuum without consulting with tribes to learn about the innumerable tools that we have developed to ensure that we conduct business in a manner that is fair, responsible, compliant and benefits our tribal members and the American consumer.”
Treppa went on to urge Congress to make sure that their approach shows the proper respect to the sovereignty and self-regulation that tribes, like Habematolel have already put in place. The Executive Director of the NAFSA acknowledged that Dodd-Frank, the legislation that ultimately led to the creation of the CFPB, gives the power of co-regulation to Native American tribes. Brandon said, “As federally-recognized sovereign nations, NAFSA member tribes enact and operate under strict tribal lending laws that safeguard borrowers and regulate tribal businesses. NAFSA is hopeful the CFPB’s rule will respect the status of tribal nations as co-regulators as specified by the Dodd-Frank Act, and ensure consumers remain protected while preserving the right of American families to access the financial products that they need.”
Both Brandon and Treppa have strongly urged the entire body of the Congress to work to make sure that the CFPB does not turn its back on the unique relationship that the tribes and the United States government have. Both ultimately hope that the tribes and the government are able to have a realistic discussion about the interests that both parties have in providing protection to consumers.