Speaking before the National Baptist Convention, Richard Cordray, director of the Consumer Financial Protection Bureau (CFPB), called on religious leaders to continue offering guidance and support for members of their faith communities who are struggling financially. Using the story of Jacob’s Ladder as a metaphor, Cordray noted that for many families, particularly African-American families, the climb up the ladder of financial success, security, and stability has been a long and, as of yet, unfinished journey. Cordray remarked that the mission of the CFPB is to “hold the ladder steady” and empower Americans to make sound financial decisions. He warned of the “Four Ds” that may cause families to fall back down this ladder: deceptive marketing, debt traps, dead ends, and discrimination.
Debt traps, the second of the “Four Ds,” ensnare consumers in a downward spiral of indebtedness that can spell disaster for a family’s personal finances. The CFPB Director warned that products marketed as a short-term solution for immediate needs–like payday loans–can be risky for consumers and often lead to a vicious cycle of borrowing to pay off high interest rates and compounding fees. Cordray thanked the religious leaders for being outspoken on the subject of payday loans and assured them that the CFPB is “paying close attention” and has teams dedicated to reviewing payday lenders’ business practices.
Cordray beseeched those in attendance to do more to prepare young people to make important financial decisions. He encouraged the audience to help spread the word about the CFPB’s mission and resources. The director closed his remarks with a statement of cooperation and optimism: “Together we can see to it that more people can climb that ladder to security and prosperity.”