MW 7 ways to safeguard your money as the Trump administration weakens consumer protections

By Venessa WongAndrew Keshner

'People need to get over this whole notion that somehow they are being rude by asking a question'

Americans are feeling increasingly unsure about their money - and it's not clear how far Trump administration regulators will go to police the financial institutions in their lives.

At a time when recession fears are rising, consumer advocates say help does not appear to be on the way, putting the onus on Americans to wage their own fights against scams, rip-offs and bad deals.

Exhibit A: the recent change of course at the Consumer Financial Protection Bureau.

Since President Donald Trump took office in January, the embattled watchdog agency - created in the aftermath of the Great Recession to regulate the financial-services industry - has halted lawsuits against companies accused of mistreating their customers and pulled back on rules meant to protect consumers.

Meanwhile, a federal-workers union is suing to try to block the Trump administration's attempts to enact mass layoffs at the regulator.

"It's sending a strong message that the CFPB is not here for consumers anymore; that under the Trump administration, the CFPB is here to give out pardons for violating the law," Erin Witte, director of consumer protection at the Consumer Federation of America, a left-leaning consumer-rights organization, told MarketWatch.

It has been "disheartening" to watch the CFPB's new turn, said Teresa Murray, director of the consumer-watchdog office at U.S. PIRG. Yet it reaffirms what was the case long before the administration change, she said: "Everyone has always needed to be their own best advocate."

In recent weeks, the CFPB has dismissed a lawsuit against Zelle owner Early Warning Services and big banks JPMorgan Chase $(JPM)$, Bank of America $(BAC.SI)$ and Wells Fargo $(WFC)$ that alleged the banks rushed the payment platform to market without adequate protections for consumers defrauded on the platform. The agency also recently dropped a number of high-profile enforcement actions against Capital One $(COF)$, Rocket Homes $(RKT)$, Vanderbilt Mortgage and TransUnion $(TRU.UK)$.

Some of those companies issued statements applauding the end of the cases against them, alleging that the CFPB's approach during the Biden administration went too far and that its lawsuits were flawed and politically motivated.

See also: What eliminating the nation's top consumer watchdog means for home buyers and renters. 'It's open season.'

What 'right-sizing' the CFPB could look like

Republicans also say the agency has repeatedly overstepped its powers. Jonathan McKernan, Trump's nominee for CFPB director, said during a recent Senate hearing that the regulator must become "refocus[ed] on its mission."

"We need to right-size it to make sure we have an efficient CFPB," said McKernan, a lawyer and onetime board member of the Federal Deposit Insurance Corporation, a banking regulator.

McKernan pledged that if he were confirmed, he'd maintain the agency's phone hotline for consumers who have questions or complaints, its complaint database, and its mandated offices for military members, senior citizens and student-loan borrowers.

The CFPB was established in 2010 as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act to provide another layer of supervision for consumer-facing banks, lenders, credit-reporting agencies and debt-collection companies. The agency filled a need, supporters said at the time. Other banking regulators "were much more concerned with the banks and bank conduct rather than worrying about how consumers were actually being impacted," said Witte.

The agency estimates it has saved Americans more than $21 billion since it was created. Some of that money came in the form of cash returned to defrauded consumers.

Lindsey Johnson, president and chief executive of the Consumer Bankers Association - a trade group focused on retail banking, and an outspoken critic of the CFPB's recent track record - told MarketWatch that the CFPB had taken a heavy-handed approach during former President Joe Biden's administration that overlooked laws and data. In January, the CBA laid out a list of proposed reforms to the agency that included rescinding a rule that would have capped overdraft fees as well as conducting an analysis of how CFPB rules impact low- and moderate-income consumers.

"Banks need credible, durable and stable financial protections," and the CFPB also needs fixing, Johnson said. "Two things can be true."

Americans are feeling financially vulnerable

The CFPB's uncertain future coincides with growing uncertainty about the economy. The stock market continued a sharp pullback Monday, the same day a new survey showed mounting consumer pessimism about money.

Americans' perceived chance of missing a minimum debt payment in the next three months climbed in February to its highest point since April 2020, according to the Federal Reserve Bank of New York's survey of consumer expectations released Monday. Respondents' outlooks on their money noticeably deteriorated last month, the survey showed.

Also on Monday, new Federal Trade Commission data showed Americans lost $12.5 billion to fraud in 2024. That's a 25% year-over-year increase, the agency said, noting the spike came from more costly scams rather than a jump in complaints.

When times are tough, frauds and raw deals will hurt even more for cash-strapped consumers. MarketWatch spoke with experts about how people can protect themselves - and the first tip is to recognize the power they already have as consumers.

Asking questions and taking notes and screenshots are key tactics for consumers, said Murray. "People need to get over this whole notion that somehow they are being rude by asking a question. You don't have to be angry or snotty or accusatory," she said. The line could just be, "'Oh hey, could you explain this to me?' People are mortified at standing up for themselves."

At the same time, keeping a watchful eye on your money is not easy. Life gets busy; people have plenty of other things demanding their attention. While it is as important as ever to monitor your monthly statements and understand the terms of any financial company you are engaging with, here are some other steps to protect your money that require very little effort on your part.

How to protect your financial identity

Freeze your credit report

A 2018 law gave consumers the right to freeze and unfreeze their credit for free to prevent bad actors from opening financial accounts using their identity. "Freeze your credit reports with Equifax $(EFX)$, Experian (UK:EXPN) (EXPGY) and TransUnion to prevent fraudulent credit accounts from being opened in your name," said Mike Litt, consumer campaign director at U.S. PIRG.

Set up transaction alerts

Enable text and email notifications to keep yourself updated on activity on your financial accounts - including credit cards, bank accounts and payment apps - to quickly identify unauthorized transactions, Litt suggested.

How to avoid bad actors

Block calls from unknown callers

Scams come at us from every direction now: text messages, social media, even payment apps. Americans lost $10 billion to scams in 2023. Your best protection: do not engage. "Be cautious of unexpected phone calls, texts or emails related to payments or your account," Litt said. "Instead of responding to unexpected messages or searching online, directly sign in to your account or use trusted contact information from your bank card or recent statement to find phone numbers or websites."

Be wary of calls from 'the IRS'

Particularly during tax-filing season, scammers like to pretend they're the Internal Revenue Service and pressure people into paying them to avoid tax debts. If the IRS spots a genuine tax issue, the agency says, it generally reaches out through the mail instead of phone calls or text messages. The tax collector also says it doesn't accept payment in the form of gift cards or prepaid debit cards, nor threatens to call police or immigration officials.

It's important to file an income-tax return as soon as it's accurate and complete. That's a guard against identity theft and a stolen refund - and a more useful step than printing out a hard copy of your Social Security records, as some TikTok users have advised.

How to keep more of your money in your hands

Opt out of debit-card and ATM overdraft protection

Overdraft fees, which average $29, generate about $5 billion in annual revenue for banks. A CFPB rule finalized in January that caps overdraft fees at $5 has been challenged by Republican lawmakers and now faces an uncertain future. Last week, a House committee voted to pull back the rule.

If you tend to overdraw your account and rack up fees for going below a $0 balance, the easiest way to avoid these expenses is by contacting your bank and opting out of being able to overdraft your checking account. The benefit of opting out is that you won't be charged this fee - but remember, it also means transactions will be declined when you don't have sufficient funds.

Review your subscriptions

Companies, from streaming services to gyms, have found an easy way to stabilize revenue: subscription models that allow them to charge a recurring fee. An FTC rule that would make it easy for consumers to cancel subscriptions should be in full effect by May, but faces challenges from industry groups, trade groups, private companies and the U.S. Chamber of Commerce. There are apps and services that track and cancel subscriptions, like Rocket Money and Experian BillFixer, but they cost money. The cheaper way to do it: Manually review your bank or credit-card statements from the last year. Yes, it's slower, but it's really only 12 statements, and may help you be more mindful of what subscriptions you purchase.

Be curious about your banking

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March 13, 2025 10:32 ET (14:32 GMT)

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