The CFPB has announced the launch of its Financial Coaching Initiative which targets
recently-transitioned veterans and economically vulnerable consumers. (The CFPB first announced its plans for launching the program in 2013, at which time it was expecting a 2014 launch date.)
The CFPB is calling the Financial Coaching Initiative its first program paid for by the CFPB’s Civil Penalty Fund (CPF). When the CFPB collects civil penalties in an enforcement action, it is required to deposit them in the CPF. The funds are first to be used to compensate consumers who were harmed by the activities for which civil penalties were imposed. If funds remain after the CFPB has provided full compensation to all eligible victims or if payments to victims are impracticable because victims cannot be located or it is otherwise impracticable to pay victims, the CFPB can use the funds for consumer education and financial literacy programs.
In its announcement, the CFPB states that the coaches hired for the program have experience working with the populations they will serve, are trained in financial coaching techniques, and will be accredited by the Association for Financial Counseling and Planning Education. In partnership with the Department of Labor, and after a nationwide search, the CFPB selected 60 partner organizations from around the country to host the professional financial coaches. The organizations include various nonprofits, as well as Department of Labor American Job Centers, that provide resources to help people find jobs, identify training programs, and gain job skills. According to the CFPB, all of the nonprofits it selected to host financial coaches for economically vulnerable consumers also provide services that complement financial coaching, such as job training and education, social, and housing services.