Capito Announces Subcommittee Will Conduct Oversight Of CFPB

Cmte Financial Services (R)
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Capito Announces Subcommittee Will Conduct Oversight Of CFPB

Financial Institutions and Consumer Credit Subcommittee Chairman Shelley Moore Capito announced the Subcommittee will question Assistant to the President and Advisor to the Treasury Secretary Elizabeth Warren during its hearing on the new Consumer Financial Protection Bureau (CFPB) on Wednesday, March 16 at 10 a.m. in room 2128 Rayburn.

Subcommittee Chairman Capito said, “The Subcommittee looks forward to having Professor Warren join us for what I hope will be a broad discussion of the Consumer Financial Protection Bureau. Like many of my colleagues, I have reservations about the bureau and unintended consequences it could have on consumer choice in financial products. This will be the start of a robust discussion of how the Consumer Financial Protection Bureau will be implemented and what powers it should have in regulating consumer credit.”

Financial Services Committee Chairman Spencer Bachus said, “The Dodd-Frank Act confers virtually unfettered discretion on the director of the Bureau to identify financial products and services that the director finds to be ‘unfair, deceptive, or abusive’ and ban them under a highly subjective standard that has no legally defined content. This broad and undefined authority makes the Bureau perhaps the single most powerful agency ever created by an act of Congress. Professor Warren has not been nominated by the President to serve as the Bureau’s director, yet she is working as its de facto director and hiring staff. As she has gone about her work, it has become even clearer to me that the Dodd-Frank Act put too much power in the hands of one person.”

The Dodd-Frank Act created the CFPB within the Federal Reserve to regulate providers of credit and other consumer financial products and services. The Act confers upon the CFPB Director, who has yet to be appointed by the President, a broad mandate that includes consumer protection functions transferred from seven different Federal agencies, and the authority to write rules, supervise compliance, and enforce all consumer protection laws and regulations. The Act also gives the Director the authority to determine the budget of the Agency capped at 12 percent of the Federal Reserve’s earnings, thereby escaping the Congressional appropriations process and shielding the Agency from proper Congressional oversight.