Weeks after Elon Musk called for the Consumer Financial Protection Bureau to be “deleted,” the agency announced a series of actions Wednesday to stop credit card companies from luring customers with rewards they can never redeem. 

What You Need To Know

  • The Consumer Financial Protection Bureau announced a series of actions Wednesday to stop credit card companies from luring customers with rewards they can never redeem

  • The agency sent a warning to law enforcement agencies, alerting them to credit card issuers’ potential violations of the law if they devalue earned rewards or prevent consumers from obtaining or redeeming the rewards they were promised

  • To help consumers find the best credit cards for their needs, the CFPB also launched a new Explore Credit Cards tool

  • The CFPB announced the new actions at a time when consumer applications for retail credit cards spike over the holidays

The CFPB also launched a new tool to help consumers comparison shop for cards with the lowest rates.

“Large credit card issuers too often play a shell game to lure people into high-cost cards, boosting their own profits while denying consumers the rewards they’ve earned,” CFPB Director Rohit Chopra said in a statement. “When credit card issuers promise cashback bonuses or free round-trip airfares, they should actually deliver them.”

The CFPB announced the new actions at a time when consumer applications for retail credit cards spike over the holidays.

"Despite widespread evidence that credit card rewards programs are highly popular and deliver tremendous value to tens of millions of U.S. cardholders from all walks of life, Director Chopra has once again chosen not to let facts get in the way of his decision to tarnish a hugely popular consumer product," American Bankers Association President Rob Nichols said in a statement. "Consumer complaints about credit card rewards are exceedingly rare, making up only about 0.09% of all the complaints submitted to the CFPB."

The agency sent a warning to law enforcement agencies Wednesday, alerting them to credit card issuers’ potential violations of the law if they devalue earned rewards or prevent consumers from obtaining or redeeming the rewards they were promised, such as airline miles. The CFPB reported receiving numerous complaints about retailers’ credit cards, which charge significantly higher rates and fees.

To help consumers find the best credit cards for their needs, the CFPB is now offering an Explore Credit Cards tool that lets them compare more than 500 credit cards. Based on public data about credit card terms from 150+ issuers, the site is an alternative to other credit card comparison sites that receive money for promoting certain cards.