WASHINGTON — The new federal agency charged with enforcing consumer finance laws is emerging as an ambitious sheriff, taking on companies for deceptive fees and marketing and unmoved by protests that its tactics go too far.
In the 14 months it has existed, the Consumer Financial Protection Bureau has launched dozens of enforcement investigations and issued more than 100 subpoenas demanding data, testimony, and marketing materials — sometimes amounting to millions of pages — from companies that include credit card lenders, for-profit colleges, and mortgage servicers.
More than two dozen interviews with agency officials and industry executives offered sweeping insight into the new agency's behind-the-scenes efforts, which have taken the financial industry off guard and have been far more aggressive than previously known.
The number of subpoenas and investigations was confirmed by agency, industry, and trade group officials who spoke to the Associated Press on condition of anonymity because the subpoenas bar both sides from discussing them.
The bureau's actions have many banks, payday lenders, and credit card companies racing to adjust. They're tightening their record-keeping and budgeting for defense lawyers, according to attorneys and trade group executives who work with them. The companies themselves are reluctant to discuss the bureau because they don't want to be seen as criticizing a regulator that is still choosing its battles.
The financial crisis of 2008 led to far-reaching changes to how the US government oversees financial companies. The consumer bureau, created by the 2010 financial overhaul law known as the Dodd-Frank Act, gained new powers to reach deep into the most mundane decisions of money-transfer agents, auto lenders, and virtually anyone else who provides financial products and services.
For regular Americans, the bureau is the most visible result of the shake-up in financial oversight. Its decisions are changing the mortgage application and foreclosure process, the way people lodge complaints against financial companies and, in some cases, what fees they can be charged.
''The CFPB is a new animal, and they have to establish their turf and a way of doing business,'' says Jack Conway, the attorney general of Kentucky and an outspoken critic of for-profit colleges. ''If that breaks from standard practice of other regulators, I don't have a huge problem with it.''
For companies, the bureau embodies a bitter debate over whether the government has gone too far, imposing huge costs on firms that already operate legally but now must prove it. Why should regulators increase companies' costs, critics ask, in an economy that has many struggling to stay afloat?
Some industries, such as mortgage insurers and for-profit schools, are pushing back. They say the consumer bureau is redefining laws — deeming as illegal practices that were long acceptable to other regulators.
So far, the bureau's aggressive approach has netted one high-profile win: an agreement by Capital One Financial, the fifth-biggest US credit card issuer, to refund $150 million in fees directly to the accounts of 2.5 million customers — without the complicated paperwork often associated with class-action settlements on behalf of consumers.
Elizabeth Warren, the Democratic candidate for the US Senate from Massachusetts who is credited with proposing the agency, says the Capital One case reflects the agency's emergence as a consequential enforcer of financial laws.
''They didn't start with easy pickings — they went straight to the heart of the problem,'' Warren says. ''It's a sober agency. It's a careful agency. But it's not timid.''