Warren Calls Out CEOs Behind Lobbyists on Consumer-Protection Rule

Elizabeth Warren is trying to flush out the CEOs behind big-bank lobbyists.

The Democratic U.S. senator from Massachusetts sent letters on Thursday, Aug. 10, to the CEOs of JPMorgan Chase & Co. (JPM) and 15 other banks and financial firms demanding to know their position on a new rule announced last month by the Consumer Financial Protection Bureau, according to a press release.

Lobbyists representing big banks have condemned the rule, but CEOs who preside over the industry have "remained silent" on the matter, she said in the press release. According to the CFPB, the new rule bans banks and credit-card providers from forcing customers to go through arbitration hearings when they have a grievance, instead of banding together to file class-action lawsuits.

"If your lobbyists are taking such strong positions against this rule, is there a reason both you and your bank have been unwilling to take a public position?" Warren wrote. According to the senator, Republicans in Congress have introduced a resolution to undo the CFPB's new rule. 

Warren's effort to expose the power and money behind lobbyists echoes President Donald Trump's pledge to "drain the swamp," a reference to the special interests that bog down legislation and good government. The New York Times reported last week that the Transportation Department has appointed three former industry representatives to help dismantle government regulations.

Trump also has pledged to overhaul financial regulation, a top priority of the banking industry. JPMorgan CEO Jamie Dimon told CNBC this week that "the leadership of America hasn't done the thing that could get us growing faster - jobs and wages."

JPMorgan press officials didn't immediately return a call for comment. Other banks to receive the letters included Bank of America Corp. (BAC) , Wells Fargo & Co. (WFC) and Citigroup Inc. (C)

Prior to her election to the Senate in 2012, Warren was a professor at Harvard Law School specializing in bankruptcy. She also was a driving force behind the creation of the CFPB, formed in the wake of the 2008 financial crisis.

According to the press release, Warren asked the financial firms' CEOs to state "whether they agree or disagree with the CFPB's analysis." Responses were requested by Sept. 1.

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