‘Improving Transparency and Accountability at CFPB’

In a hearing by the House Financial Services Committee in April, Mick Mulvaney, Acting Director at the Bureau of Consumer Financial Protection (CFPB) had made recommendations to improve the “transparency and accountability,” at the Bureau.

On Wednesday, The Subcommittee on Financial Institutions and Consumer Credit held a hearing entitled “Improving Transparency and Accountability at the Bureau of Consumer Financial Protection” that discussed Mulvaney’s recommendations and other reforms that would help promote greater transparency and accountability at the Bureau.

In his remarks at the hearing, Subcommittee Chairman Blaine Luetkemeyer said that Mulvaney was striving to foster an environment that promoted transparency, legitimacy, and greater consumer choice. However, recognizing that not all reforms could be done administratively, Luetkemeyer said, "The American people deserve a Bureau of Consumer Financial Protection that enforces the law rather than creates it, and that gives power and choice back to the consumers."

During their testimonies at this hearing, Steven Day, President American Land Title Association; Richard Hunt, President and CEO, Consumer Bankers Association; Kate (Larson) Prochaska, Director Center for Capital Markets Competitiveness, U.S. Chamber of Commerce; Hillary O. Shelton, Director, Washington Bureau and SVP, Advocacy and Policy, National Association for the Advancement of Colored People (NAACP); and Elmer Whitaker, CEO, Whitaker Bank Corporation of Kentucky gave the panel a number of recommendations. They included:

• Instituting Congressional control over CFPB’s budget and subjecting CFPB to the Congressional appropriations process
• Coordinating regulatory activities with other agencies to avoid duplication and burden
• Reforming the consumer complaint database
• Providing clear rules and avoid rulemaking by enforcement
• Reviewing the amount of information and number of mortgage lenders required to make public their loans under the Home Mortgage Disclosure Act (HMDA)
• Reasserting the enforcement powers of the Office of Fair Lending
• Establishing a bipartisan commission at the CFPB to lead the Bureau
• Reviewing Rules for small-dollar bank lending and small business lending
• Establishing debt collection regulations for third-party debt collectors for the right balance between consumer protection and consumer engagement
• Creating a CFPB Advisory Opinion Process
• Reviewing Section 1071 of the Dodd-Frank Act that requires the Bureau to prescribe rules for collecting and reporting data on lending to minority-owned and women-owned small businesses

Apart from these recommendations the Credit Union National Association (CUNA) also sent a letter to the subcommittee urging the CFPB to streamline regulatory burdens for credit unions and work more closely with the National Credit Union Administration (NCUA) on compliance.

“Consumers lose when one-size-fits-all rules force credit unions to pull back safe and affordable options from the market, pushing consumers into the arms of the providers engaged in the very activity that the rules were designed to curtail,” the letter said.