Happy birthday, CFPB

Tomorrow, the Consumer Financial Protection Bureau completes its first year of operation. Created under the Dodd-Frank Act, we’re starting to see the benefits of a strong federal agency that protects consumers from the dangers posed by an unchecked financial industry.

The CFPB notched its first enforcement action—and hopefully, the first of many—yesterday with the announcement that Capital One will pay up to $210 million to settle federal charges that it violated consumer protection requirements. According to CFPB charges, Capital One used “deceptive practices” to sell unnecessary add-ons to credit card holders. Between $140 million and $150 million will be paid to the two million customers affected. Capital One will pay another $60 million in fines, with $25 million going to the CFPB and $35 million to the bank-regulating Office of the Comptroller of the Currency.

Today, the CFPB followed up this victory with the release of a report on the private student loan industry, to which American consumers owe more than $150 billion in debt. The extensive report identifies several consumer protection issues in the private student loan marketplace. Importantly, though, the report doesn’t just stop there: It includes strong congressional policy recommendations by CFPB Director Richard Cordray and Secretary of Education Arne Duncan.

These actions by the CFPB are encouraging, but the history of financial regulation teaches us that the real challenge is maintaining vigilance over time. This means keeping up with financial intermediaries’ attempts to arbitrage between different regulatory agencies, bypass current regulatory structures, and capture regulating agencies. The CFPB had a good first year, but the real challenges will appear in the years to come.