Critics say the actions amount to "corporate pardons"
of ConsumerAffairs- The Consumer Financial Protection Bureau (CFPB) has canceled major enforcement actions against Toyota and Walmart, including dropping a $60 million settlement with Toyota over deceptive auto add-on fees.
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The CFPB also dismissed a federal lawsuit against Walmart and Branch over an alleged $10 million in junk fees charged to more than a million gig workers.
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Critics say the moves are part of President Trumps broader agenda to weaken CFPB oversight, with some calling the cancellations corporate pardons.
The U.S. Consumer Financial Protection Bureau on Monday canceled a major 2023 enforcement settlement with Toyota and dropped a separate lawsuit against Walmart and its payments partner Branch, in a pair of sweeping reversals that signal a dramatic shift in the agencys direction under President Donald Trump.
The CFPB had previously ordered Toyotas financing arm to pay a combined $60 million $12 million in penalties and $48 million in consumer restitution for allegedly steering car buyers into costly and unwanted add-on products, often by misleading them or making cancellation deliberately difficult.
But according to a May 13 agency document, that order has now been vacated. Toyota no longer faces financial penalties or requirements to compensate affected consumers, according to Reuters.The CFPB provided no explanation in the public order for its decision, though Toyota said in a statement that it welcomed the agencys move and would continue to focus on enhancing our practices to deliver the best possible customer experiences.
Walmart case dropped
In a separate action, the CFPB dropped a lawsuit filed last year against Walmart and Branch, which the agency had accused of forcing more than a million delivery drivers into high-fee payment accounts resulting in over $10 million in junk fees. Walmart responded by calling the now-withdrawn lawsuit rushed and erroneous and said it never should have been filed in the first place.
Consumer advocates swiftly condemned the CFPBs reversals. Eric Halperin, former head of the agencys enforcement division who resigned earlier this year, said the cancellation of Toyotas settlement amounted to an inexplicable corporate pardon.
The Trump CFPB doesnt want to just pull back on enforcing the law, Halperin said. It wants to actively reward lawbreakers instead.
The dropped cases are the latest in a series of steps by the Trump administration to minimize the CFPBs role as a consumer watchdog.
President Trump has frequently criticized the agency, calling it a vehicle for politicized enforcement and suggesting it should be dismantled entirely. Since he returned to office, nearly all outstanding CFPB enforcement actions from the previous administration have been ended or curtailed.
In the now-vacated Toyota case, the CFPB said in 2023 that consumers were misled by dealerships into believing add-on coverage for theft, tire damage, and extended warranties was mandatory.
Posted: 2025-05-14 14:26:01
