FSC Majority | Week in Review
Posted by Staff on June 26, 2015
Committee Seeks Accountability for Discrimination and Retaliation at the CFPB

On Thursday the Oversight and Investigations Subcommittee held a hearing to examine new evidence that discrimination and retaliation against employees at the Consumer Financial Protection Bureau (CFPB) continue. The Committee began its investigation into these allegations in April 2014. Since then, several whistleblowers have come forward to allege CFPB managers have created a toxic workplace. Despite promises last year from CFPB Director Richard Cordray that this unacceptable and offensive behavior at the CFPB would stop, two whistleblowers testified on Thursday that discrimination and retaliation have gotten worse during the past year.

Subcommittee Chairman Sean Duffy (R-WI) said in his opening statement, "This Committee has spent two years and more than five Congressional hearings giving a voice to the victims of abusive, unfair and unlawful discriminatory behavior of CFPB managers. We are here again today because their messages have clearly not been heard. There is mounting evidence that not only does the agency still have a huge problem with managers discriminating against employees based on race, age, gender, and sexual orientation, but CFPB leadership refuses to take meaningful action to prevent this behavior and protect its employees."

Both witnesses testified that they believed CFPB Director Richard Cordray did not take these issues seriously.

Committee members emphasized discrimination and retaliation must end, and there must be accountability at the CFPB.

Rep. Scott Tipton (R-CO) remarked, "In the private sector, when there are issues that are coming up on discrimination, there will be fines, there will be penalties, and there will be prescriptive measures to be able to address it. Yet apparently from what you are testifying here today, the government is not applying the same rules to itself that it expects, may not achieve, but expects out of the private sector."

Rep. Mia Love (R-UT) said change is needed at the CFPB.

"How can an agency that is unable and unwilling to govern itself be entrusted to protect the American people and, frankly, make sound decisions about how it pursues its own mission?” she asked. “Perhaps most disturbing to me is that despite all the publicity this issue has received and all the previous congressional hearings, overwhelming evidence indicates this culture of discrimination and intimidation within the CFPB has only been growing worse. It’s clear to me that reform of the CFPB is badly needed," she said.

Task Force Examines Security of U.S. Financial Sector

The Task Force to Investigate Terrorism Financing held its third hearing on Wednesday where it evaluated the security of the U.S. financial sector. At the hearing, the Task Force discussed the financial sector’s vulnerabilities to cyber-attacks as well as how terrorist organizations and criminal groups are using shell companies to launder money and fund their activities.

In his opening statement, Chairman Michael Fitzpatrick (R-PA) voiced concerns about the increasing number, size and damaging effects of recent cyber-attacks. “In the past several years, there has been a noticeable rise in the number of cyber-related attacks on U.S. businesses and government agencies launched by state and non-state actors alike. This is attributed to the fact that such attacks cost very little to carry out, but have potential to cause severe problems and inflict great cost on the victim attempting to carry out the defense. The U.S. financial sector is too important for this task force to overlook when seeking to address the nexus of terrorism and finance. The continued innovation and evolution by our enemies highlights the importance of this body’s role in the fight against terror. The United States must do better when defending our financial system and addressing the threats operating within it. The risk is too great to ignore. “

Vice Chairman Robert Pittenger (R-NC) echoed these sentiments. “Recent reports from the State Department and the Treasury Department have further highlighted the priority we must place on our counter-terrorist financing efforts. The 2014 State Department country reports on terrorism make it clear that terrorism is becoming more prevalent. The number of attacks increased by 35%. There were 3,000 more attacks in 2014 than in 2013. The fatalities increased 81%, to 32,727 deaths in 2014. The National Terrorism Financing Risk Assessment shows that while we have made progress in undermining terrorist financing, there’s still vulnerabilities in our system and more can be done.”

John W. Carlson, the Chief of Staff at the Financial Services Information Sharing and Analysis Center, shared his view on the current threat faced by the United States today. “The current cyber threat environment continues to evolve and intensify. Each day, cyber risk grows as attacks increase in number, pace, and complexity. Our members constantly adapt to this changing threat environment. We are no longer in the days wherein the threat was confined to individual hacktivists and fraudsters. We are now in an era of attacks by not only organized crime syndicates, but also nation-states and entities affiliated with terrorist operations.”


Rep. Sean Duffy | Accountability at the CFPB

The Chairman of the Oversight and Investigations Subcommittee is Sean Duffy (R-Wisconsin), who has been at the forefront of legislative efforts to reform the CFPB. In March, Duffy introduced a comprehensive package to reform the Bureau, which included proposals to replace the Bureau's director, Richard Cordray, with a bipartisan five-member board; and a proposal to make the Bureau subject to the regular Congressional appropriations process.

Weekend Must Reads

Forbes | Congress Should Reign In Rogue CFPB

That’s not to say that all regulations are bad and consumers tend to support reasonable regulations, ones that make sense, such as regulations that protect people from food that will make them sick or protect them from a dangerous product. They tend to draw the line when regulations that are purported to help them in the name of consumer protection, make things more challenging if not out right difficult for them by prohibiting access to services or in this case capital.

Investor's Business Daily | The New American Dream Under Obama: Renting

The heavy federal hand in the housing market has been a disaster. Despite spending more than $13,000 for every household, Washington has record low homeownership to show for it, even among the middle class.

Hoover Daily Report | How the U.S. Can Return to 4% Growth

Economic growth in real terms is averaging a meager 2.2% annual rate in the 23 quarters since the recession’s trough in June 2009. The consensus forecast of about 1% growth for the first half of this year offers little solace. Americans need not be resigned to such a dim fate.

    In the News

American Banker | CFPB Civil Rights Officer Says Agency Makes 'Mockery' of Process

Housing Wire | CFPB employees: Workplace discrimination getting worse, leadership absent

Politico Pro | Racial tension erupts at House hearing on discrimination at CFPB

American Banker | Dems' Defense of CFPB: Let's Talk About Something Else

The Hill | Dems accuse GOP of playing race card in contentious hearing

Housing Wire | Whistleblowers to testify on alleged discrimination at CFPB

American Banker | CFPB 'Whistleblowers' to Air Bias Claims Before Lawmakers

The Hill | Yellen pushes back on GOP 'obstruction' claims
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