Improving Transparency and Accountability at the Bureau of Consumer Financial Protection
Washington,
June 6, 2018 -
On April 2, 2018, the Bureau of Consumer Financial Protection (Bureau) issued its thirteenth semi-annual report to the President and Congress, which included a request by Acting Director Mick Mulvaney that Congress enact four changes to establish transparency and accountability at the Bureau. The Financial Institutions and Consumer Credit Subcommittee held a hearing today to examine these recommendations as well as other reforms that would promote greater transparency and accountability at the Bureau.
“Bureau of Consumer Financial Protection bureaucrats have worked diligently to eliminate options for Americans, arrogantly thinking they are better equipped than consumers to make financial decisions. Thankfully, Acting Director Mulvaney is striving to foster an environment that promotes transparency, legitimacy, and greater consumer choice. He has committed to a more tempered and data-driven process. He’s outlining a vision that, for the first time, conforms to Congress’ mandate. The Acting Director is to be commended for the progress he’s made thus far, but we must recognize that not all reforms can be done administratively,” said Subcommittee Chairman Blaine Luetkemeyer (R-MO). “The American people deserve a Bureau of Consumer Financial Protection that enforces law rather than creates it; and that gives power and choice back to the consumers.”
Key Takeaways
- The Bureau remains unaccountable to Congress and the American people because it is not subject to the same checks and balances as other regulatory agencies.
- Real consumer protection puts power where it belongs: in the hands of consumers, not a single Washington bureaucrat.
Topline Quotes from Witnesses
“The Bureau has been given broad authority that can alter financial markets, but it lacks accountability that comes from budget oversight…Regulation, whether by the CFPB or other regulatory agencies, shapes the way banks do business and can help or hinder the smooth functioning of the credit cycle and economic expansion… The rules in Dodd-Frank have caused some banks to stop offering certain products altogether, such as mortgage and other consumer loans… By eliminating unnecessary impediments and ensuring that the agencies that oversee our products are fully transparent, Congress can help stem the tide of community bank consolidation driven by these unnecessary regulations which negatively impact every community across the United States.” – Elmer K. Whitaker, Chief Executive Officer, Whitaker Bank Corporation of Kentucky
“The retail banking industry is best able to serve its customers when there is a stable and even-handed regulatory framework that produces clear and reasonable rules of the road…Improving the financial lives of our customers is a goal that unites lawmakers, regulators and industry. The best way to ensure that shared outcome for consumers is for Congress to pass legislation that will bring more accountability to the Bureau.” – Richard Hunt, President and CEO, Consumer Bankers Association
“Years ago, the Chamber urged the Bureau to: promote access to credit, competitiveness, and choice for consumers and small businesses; reduce regulatory burden to spur economic growth; and produce policy in a data-driven and transparent manner. Unfortunately, the Bureau’s past leadership often did not prioritize these goals to the detriment of the financial marketplace and ultimately consumers… The Chamber deeply supports strong consumer protections and a robust, transparent marketplace of consumer products and services…I look forward to working with the Committee and this Subcommittee on legislative proposals that make the Bureau more mature, accountable, and transparent.” – Kate (Larson) Prochaska, Director, The Chamber of Commerce
“The best way to improve transparency at the Bureau is to ensure it provides reliable guidance to businesses… Compliance is about more than protecting consumers. It protects a company’s reputation, financial well-being and employee morale. As an industry predominantly made up of small- and medium-sized businesses, we need a regulator that helps remove the gray. We need a regulator that matches simple and clear regulations with helpful and illustrative guidance and examples. A regulator that makes it easier for us to protect our reputation, bottom line and ultimately our consumers. ” – Steven G. Day, President, American Land Title Association
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