The US Consumer Financial Protection Bureau (CFPB) is making headlines once again, as the agency’s enforcement arm unravels.
On June 11, the CFPB’s top enforcement official, Cara Petersen, resigned after sending an internal email criticising the direction of the agency. Reuters first reported the news and claimed to have seen the email.
“I have served under every director and acting director in the bureau’s history and never before have I seen the ability to perform our core mission so under attack,” Petersen wrote.
“It has been devastating to see the bureau’s enforcement function being dismantled through thoughtless reductions in staff, inexplicable dismissals of cases, and terminations of negotiated settlements that let wrongdoers off the hook.”
As noted by Petersen, she held roles at the CFPB since its inception in 2011. She rose through the ranks, serving as Assistant Litigation Deputy and later Deputy Principal Litigation in the Office of Enforcement, before becoming Principal Deputy to the Assistant Director for Enforcement.
In this role, Petersen was effectively the bureau’s lead enforcement strategist, overseeing investigations and legal actions against companies that violated federal consumer financial laws.
Her position placed her at the centre of regulatory activity affecting the payments industry. Under her watch, the CFPB pursued enforcement actions related to overdraft fees, credit reporting, prepaid card disclosures and payday lending.
So, what’s led to this point?
Since President Donald Trump took office earlier this year, the US payments sector has undergone significant change. Much of the public conversation has focused on Trump’s enthusiasm for cryptocurrency and digital assets, alongside efforts to accelerate legislation and scale back regulations to support these sectors.
Trump appointed new leadership to the CFPB, including acting Director Russell Vought and Chief Legal Officer Mark Paoletta. Within months, the agency saw drastic staff reductions and a sharp reversal of several major enforcement actions undertaken under the previous administration.
One of the most high-profile examples is the CFPB’s confirmation of its plans to rescind the 1033 Open Banking rule. Originally finalised in October 2024, the rule was designed to empower Americans to direct their financial institutions to securely share data with third-party providers of their choice.
Other notable policy shifts include the CFPB’s announcement on May 6, stating it would deprioritise enforcement of Buy Now, Pay Later (BNPL) regulations, instead focusing its resources on protecting servicemen and veterans.
Meanwhile, consumer protection saw a setback when the US House voted to repeal a CFPB rule that brought Big Tech firms under the bureau’s supervision.
Though these changes have sparked pushback from various payments stakeholders, they align with Trump’s broader deregulatory agenda aimed at fostering economic growth and encouraging foreign investment.
The future of consumer protection in payments
For Petersen, what appears most alarming is the sheer number of enforcement cases dropped under the new leadership, including cases involving Capital One and Zelle.
Petersen is not alone in expressing deep concerns about the agency’s direction. Former Enforcement Director Eric Halperin and Supervision Director Lorelei Salas also announced their intent to resign amid disputes over the bureau’s decision to halt all supervisory activities.
However, both were placed on administrative leave before submitting their resignation emails, and a CFPB spokesperson had disputed whether Salas’s resignation was ever formally tendered.
“While I wish you all the best, I worry for American consumers,” concluded Petersen’s email.
