(Reuters) - The U.S. Consumer Financial Protection Agency has canceled a 2023 settlement with Toyota Financing, a charge released by the agency, which illegally shifted thousands of consumers to expensive and unnecessary product packages, according to documents released by the agency.
The agency also filed a federal lawsuit Tuesday against retail giant Walmart and a branch of labor payment companies, which officials said last year forced more than one million delivery drivers to use accounts that cost them more than $10 million in so-called junk fees.
The Presidential Administration’s decision continues to work to minimize CFPB’s oversight of consumer finance. What Trump said the agency should be eliminated, accusing it of politicizing law enforcement, has now ended almost all pending enforcement actions when Trump took over.
The CFPB and the branch did not immediately respond to requests for comment.
Walmart said in a statement that it was satisfied with the CFPB's decision to withdraw the case it said was rushed, wrong, and "never should have been brought up first."
Under the order to cancel Toyota's settlement, CFPB specifically gave up the refund of Toyota's tens of millions of dollars and corrected the alleged damage to consumers. Monday's order provided no reason for the decision.
However, Toyota said it welcomes CFPB's actions and is committed to "doing the right thing" for Toyota buyers.
“We will continue to enhance our practices to deliver the best customer experience,” the company said in a statement.
In 2023, CFPB ordered Toyota to pay a $12 million fine and $48 million to car buyers who have been damaged since 2016.
According to the CFPB, thousands of borrowers complain that dealers lie about “attached” products whether products that provide protection for coverage such as damage, theft or insurance company are mandatory, or that Toyota is eager to buy paperwork, so buyers won’t realize what they are paying.
Regulators say Toyota makes cancelled bundles “very clumsy”, including routing more than 118,000 borrowers to a hotline, directing agents to be instructed to discourage cancellations and often failing to provide refunds.
The settlement in 2023 is attributed to the past five years.
The decision constituted an inexplicable corporate pardon, former CFPB director Eric Halperin, who resigned in February, said in a statement.
"Trump CFPB does not want to back down on enforcing the law, it wants to actively reward lawbreakers," he said.