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WASHINGTON \u2014 The Treasury Department said that it has “initiated a review” of community development finance institutions.\u00a0<\/p>\n
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Trump administration It’s been a notable change from Trump’s first term, where the CDFI program grew and politicians across the aisle praised the private-public partnership.\u00a0<\/p>\n The Treasury Department said on Monday that it would examine CDFIs for “potential violations of applicable law or CDFI requirements and to help ensure that CDFIs that receive federal assistance act as proper stewards of taxpayer funds.”\u00a0<\/p>\n “CDFIs that engage in predatory practices and take advantage of the very communities they are intended to serve will be reviewed and, where appropriate, held accountable,” Treasury Secretary Scott Bessent said in a statement. “We remain committed to enforcing the law and protecting taxpayer resources while supporting the mission of responsible CDFIs.”<\/p>\n Throughout this Trump administration, CDFIs have struggled to get access to congressionally mandated funding, as the Office of Management and Budget has delayed taking procedural steps that would allow the Treasury Department to disburse the funds.\u00a0<\/p>\n While OMB has OMB Director Russell Vought has also publicly criticized the program, echoing the White House’s rhetoric.\u00a0<\/p>\n “If you look at what these CDFIs were funding, many of them continue to be woke,” Vought said in a House Budget hearing earlier this month. “They continue to be pushing an ideology that is very harmful.”<\/p>\n Vought also referenced the safety and soundness of the program’s loans, an argument that the White House had not levied against the program up to that time.\u00a0<\/p>\n “When a CDFI does a loan, it is exempt from ability-to-pay requirements, so you’re getting a loan on the books that is not necessarily as sound and secure as one that would come from a typical bank,” Vought said. “So we have issues with this program.”<\/p>\n Treasury Secretary Scott Bessent last week echoed those sentiments, telling the Senate Appropriations Committee that “part of the CDFI program had lost its way in terms of a partisan agenda.”\u00a0<\/p>\n<\/div>\n