The Republicans' effort to reform the Consumer Financial Protection Bureau (CFPB) continued on Friday with the introduction of a comprehensive reform package by U.S. Representative Sean Duffy (R-Wisconsin).
Part of the package of CFPB reform proposals that Duffy has either sponsored or co-sponsored includes the bill introduced on Wednesday by Representative Randy Neugebauer (R-Texas) that would replace the CFPB director with a bipartisan five-member committee.
The flurry of legislation to reform the CFPB has come swiftly following the testimony of the Bureau's director, Richard Cordray, before the House Committee on Financial Services on March 3.
"After hearing testimony from Director Richard Cordray this week, I am convinced now more than ever that the CFPB is in dire need of structural reform," Duffy said. "He continues to stonewall Congress, he won’t respond to Congressional inquiries, and why would he? We have no tools in the toolbox to hold the fortress that is the CFPB accountable."
Other measures to reform the CFPB that Duffy introduced this week include: The Bureau of Consumer Financial Protection Act, which makes the CFPB subject to the regular appropriations process; the Consumer Right to Financial Privacy Act, which requires the Bureau to obtain consumers' permission before collecting data on them; the Consumer Financial Protection Safety and Soundness Improvement Act, which reduces the number of members of the Financial Stability Oversight Council that may overturn a CFPB ruling from two-thirds to a simple majority; and the CFPB Pay Fairness Act, which puts CFPB employees on the regular government pay scale (they currently set their own pay rate).
"Protecting consumers is important to everyone," Duffy said. "However, this is an agency that is led by one man. It’s an agency that makes rules and regulations that restrict access to credit for everyone while they collect data on consumers without their permission, and Congress can do nothing about it. It’s time to bring some common-sense reforms to this agency; these bills will begin to do that."
Republicans who view the CFPB as overreaching and unaccountable have tried to increase Congressional oversight for the CFPB ever since the Bureau was formed in 2011 out of the Dodd-Frank Act. They have especially made a push for CFPB reform since they gained a majority in both the House and the Senate in November. Democrats have criticized Republicans' efforts at reforming the CFPB and have repeatedly vowed to fight any legislative attempts at such reform.
"I cannot imagine staff time and resources that the Bureau has spent responding to your frivolous requests – at the expense of helping our nation’s consumers," Representative Maxine Waters (D-California) said during the hearing in which Cordray testified earlier this week. "But that’s precisely the Republican playbook. They want the CFPB to be wasting resources digging out from under a deluge of requests – so that the payday lenders, debt collectors, and other predators can continue victimizing the American people unabated."
In February, Representatives Steve Stivers (R-Ohio) and Tim Walz (D-Minnesota) revived a bipartisan bill that would create an independent Inspector General for the CFPB that is appointed by the president and approved by the Senate. The Bureau currently shares an IG with the Federal Reserve, a position that is appointed by the Fed chair and not subject to Senate approval.