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Cordray and Republicans Trade Barbs at Hearing

By MJ Lee, Politico

The head of the Consumer Financial Protection Bureau had several testy exchanges with House Republicans on Wednesday at a hearing held to examine allegations of discrimination and retaliation at the consumer agency.

CFPB Director Richard Cordray appeared before the House Financial Services Oversight and Investigations Subcommittee to address charges that have surfaced in recent months of discriminatory management practices at the agency.

The issue first caught the attention of lawmakers earlier this year when an American Banker report said white employees at the agency received higher ratings than minorities on employee reviews. Since then, the Financial Services Committee has held numerous hearings to examine the issue and compelled the testimonies of several CFPB employees through subpoenas.

On Wednesday, Cordray said the bureau takes the allegations seriously and is working to improve working conditions where needed, but Republicans pressed him about these efforts and whether enough is being done.

For instance, several Republicans grilled Cordray about CFPB whistleblower Angela Martin — a bureau employee who told the committee earlier this year that when she raised concerns about discrimination, she was retaliated against by managers at the agency.

Rep. Randy Hultgren (R-Ill.) wanted to know whether Cordray thought he owed Martin — who was sitting in the audience behind Cordray during the hearing — an apology.

“It may be comfortable for your to jump to conclusions about scapegoating people, but I can’t do that,” Cordray said.

When pressed on the issue, he added: “I’m not going to scapegoat people to satisfy you or anyone else.”

At another point in the hearing, Rep. Sean Duffy (R-Wis.) raised questions about whether a firm that the CFPB hired to review its management practices was connected to a person who has donated to Democratic politicians.

“I mean honestly,” Cordray said, pushing back to say that the issue had no place in the hearing. After several exchanges with the congressman, Cordray shot back: “You just want to tell a story, or do you want me to respond and set the record straight? Which do you want?”

The allegations of discrimination at the CFPB has heightened tensions between the agency and Hill Republicans this year. Many Republicans objected to the creation of the consumer bureau at Dodd-Frank’s inception and have introduced legislation to give Congress greater oversight of the agency. GOP members on the committee have seized on the allegations of discrimination and retaliation to argue that the agency is poorly run.

The bureau has taken numerous steps aimed at addressing the allegations recently, including an overhaul of its old employee ratings system and providing up to $5.5. million in compensation to employees who may have been wrongfully harmed by past evaluations.

Cordray said in his opening remarks that he takes “very seriously” the concerns that have been raised and that he is committed to ensuring that CFPB employees are treated fairly.

“Because of the speed with which we tried to build this new agency, we have found that we did not get everything right for our own employees,” Cordray said. “As the sole director of the bureau, I am the responsible party to work with you in providing such oversight.”

Rep. Maxine Waters, the committee’s top Democrat, seemed exasperated by the exchanges between Cordray and Republican lawmakers. She condemned her colleagues across the aisle for holding a “witch hunt” rather than a substantive questioning about the bureau’s management practices.

“This has turned into a circus. This committee has taken it upon itself led by the Republicans to attack the Consumer Financial Protection Bureau and everything that they can bring up, everything that they can think of,” Waters said. “It’s getting almost comical.”

Meanwhile, subcommittee Chairman Patrick McHenry (R-N.C.) said Wednesday that he and several Republicans on the committee recently asked the Government Accountability Office to conduct an independent investigation into the CFPB’s personnel management and organizational structure and that the GAO accepted the request.

“Shortly, bureau employees will have an opportunity to confidentially share their experience, all their concerns with the Government Accountability Office,” McHenry said.

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