The Consumer Financial Protection Bureau announced that it dropped its lawsuit against Rocket Homes that alleged the company of offering kickbacks to brokers who referred customers to Rocket Mortgage. This lawsuit which was originally initiated under the CFPB’s previous director, Rohit Chopra was dismissed in a one page notice of dismissal issued by the CFPB
The lawsuit specifically alleged that giant real estate company offered referrals to those who directed clients toward the mortgage lender, Rocket mortgage. One of those who took advantage of Rocket Homes’ incentive was Jason Mitchell, founder of the Jason Mitchell Group. The CFPB claimed that Mitchell provided gift cards to his agents who made a significant number of referrals to Rocket Mortgage. The agency explicitly claimed that Mitchell’s agents were trained to manipulate clients into thinking that Rocket Mortgage’s mortgage options were the only available and viable options.
After becoming aware of the dropped charges, Rocket Homes released a statement expressing its gratitude that the charges were dismissed. “It was good to see the truth come to light,” the company said. “This case was a misrepresentation of the facts, as we have said from the day the suit was filed. It was an empty claim brought forth by former CFPB director [Rohit] Chopra for the sole purpose of seeing his name in headlines during the final days in public office.”
CFPB Dismisses Multiple Cases After Litigation Funds Freeze
On the same day that it dropped the Rocket Homes lawsuit, the CFPB also announced that it voluntarily dismissed lawsuits against Capital one, Berkshire Hathaway, and the Pennsylvania Higher Education Assistance Agency, a student loan servicer. These dismissals come shortly after having its litigation and enforcement investigation funds frozen by its newly acting director, Scott Bessent.
President Trump has made it known that his administration aims to eliminate the CFPB as a result of the agency’s alleged politicization. His administration explicitly stated that it intends to create and more “streamlined and efficient CFPB” as a result of this “politicization.” While many view this as a positive step, many others perceive it as providing an outlet to corporations who are engaging in illegal activities.
“We’re getting a very strong message here that if you’re a bank, if you’re a student loan servicer, and you’re violating the law, the CFPB is not only not going to pursue you, they’re going to let you out of your case scot-free, ” according to the director of consumer protection at the Consumer Federation of America, Erin Witte. Public Citizen, a consumer advocacy group, echoed Director Witte’s statement, cautioning that unchecked misconduct could drive the U.S. “hurtling down the path that led to financial crises in the past.”
The CFPB isn’t the only federal agency scaling back enforcement under the new administration. The Securities and Exchange Commission announced that it has closed or paused regulatory enforcement against several cryptocurrency platforms, signaling a shift toward a more crypto-friendly stance under Trump. 