HARRISBURG – State Attorney General Josh Shapiro is turning up the heat in his crusade against wrongdoers in the lending industry, recently launching the Consumer Financial Protection Unit and hiring a former member of the Consumer Financial Protection Bureau to help run it.

Shapiro announced the formation of the agency on July 20, claiming it will protect seniors, families with students and military service members from fraudsters.

Barbara S. Mishkin
Barbara S. Mishkin

“It’s not surprising that Shapiro would be moving in this way; he has always indicated that he planned to be a proactive attorney general,” Barbara S. Mishkin, an attorney with Ballard Spahr LLC, told the Pennsylvania Record. 

“Financial service companies should be concerned in the sense this shows a plan of being active in the area and donating resources to it.”

As part of his effort, Shapiro has appointed Nicholas Smyth assistant director of the Office of Attorney General’s Bureau of Consumer Protection. Smyth's resume includes previously helping to establish the CFPB.

The CFPB was created in 2010 by the Dodd-Frank Wall Street Reform and Consumer Protection Act and regulates the financial services industry.

Part of his new campaign will also zero in on for-profit colleges and mortgage and student loan services.

The move comes on the heels of Shapiro recently joining forces with other attorney generals, naming Education Secretary Betsy DeVos as a defendant in the wake of her decision to roll back a critical student lending rule. 

Prior to that, Shapiro joined fellow attorneys general in aggressively pushing the Federal Communications Commission to allow telephone companies to block illegal robocalls.

Smyth comes to the agency ready to hit the ground running. A press release issued by Shapiro's office states that while at the CFPB, Smyth led the investigation of the subprime auto lender Drivetime, which resulted in an $8 million settlement three years ago. 

He also worked on CFPB v. ITT Educational Services Inc., the agency’s first official enforcement action against a for-profit institution, the press release states. Smyth also had a hand in the U.S. Bank’s MILES Program probe. 

The subprime auto finance program for military service members ultimately triggered nearly $7 million in consent orders.

“Activists are applauding these actions, while critics don’t think they need more people looking over their shoulders,” said Mishkin. 

“I don’t know if this creates any new powers across the state, but it means the focus will now be much more personal.”

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Pennsylvania Attorney General's Office
11 North 3rd Street
Harrisburg, PA 17101

U.S. Federal Communications Commission
445 12th St SW
Washington, DC 20024

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