In his remarks at the ABA Annual Convention yesterday, CFPB Director Richard Cordray encouraged banks of all sizes to continue working to increase financial literacy, stressing the importance of financial education for three specific groups: students, adults in the workplace and older Americans.
Cordray noted that for many banks, financial education is already a priority and praised the financial industry’s efforts. He called on all bankers to advocate for higher standards for financial education in schools and to lead by example when it comes to financial education in the workplace. He also highlighted the strong partnership between banks and law enforcement in taking action against elder fraud, announcing a forthcoming advisory from the CFPB that will help banks prevent, recognize and report adult financial abuse and educate caretakers.
“We have found that banks are often the first ones to spot danger signs of elder abuse,” he said, noting that seniors have great trust in their financial institutions. “You are especially well positioned to spot red flags and intervene quickly, so think about how you can do it more consistently and more thoroughly.”
Cordray stressed that the bureau is looking to work with banks in a non-prescriptive, non-mandated way, and he applauded the ABA Foundation for its recently announced Safe Banking for Seniors initiative.
During a question and answer session with ABA President and CEO Frank Keating following his remarks, Cordray said the bureau “has heard you” on the issue of small dollar loans. “We are trying to rein in abuses in the small-dollar loan industry,” he noted while but recognizing that banks offer small-dollar loans as a convenience to their customers facing short-term funding needs. He said the bureau wants banks to be able to accommodate those situations.