Republicans on the House Financial Services Committee are harassing the CFPB in an effort to undermine the agency’s work, committee Democrats charge in a new staff report.
“Republicans in Congress have been clamoring to weaken and ultimately destroy the consumer bureau since its creation,” panel ranking Democrat Maxine Waters (D-Ca.) said in releasing the report, which uses the fight over the CFPB’s arbitration rule as a case study.
“Congressional Republicans and the Trump administration have continued to push to undermine, and even abolish, the consumer bureau,” the report said.
The Democrats said that the bureau’s efforts to protect consumers are a vast improvement over those before enactment of the Dodd-Frank Act, which created the bureau.
“The Consumer bureau’s active enforcement and supervisory efforts are in stark contrast to those taken by the Federal financial services agencies prior to the enactment of the Dodd-Frank Act” the report stated.
Republicans have sharply disagreed with the agency and its director, Richard Cordray over several agency actions. Financial Services Chairman Jeb Hensarling (R-Texas) has introduced legislation that would sharply curtail its powers. He also has told Cordray that he should be fired and threatened to hold the director in contempt of Congress, saying he had not responded to subpoenas from the panel.
However, Waters alleges that those subpoenas were only possible because of a committee rules change during the last Congress.
She said that the committee adopted a rule in the last Congress to allow Hensarling to “unilaterally” issue subpoenas. In the past, the report states, such subpoenas were debated and voted on in a public meeting.
As a result, the agency has produced more than 170,000 pages of documents in response to more than 90 letters from committee Republicans. In addition, the committee has issued 20 subpoenas and agency employees have sat for more than 40 hours of depositions.
The staff report calls on Republicans to eliminate Hensarling’s unilateral subpoena power.
Responding to the report, Financial Services Republican spokesman Jeff Emerson said GOP members are attempting to rein in an out of control agency.
“The CFPB is a rogue agency that by design and practice operates with no accountability,” he said. “As a result, the bureau’s checkered past is chock-full of abuse, rampant allegations of racial and gender discrimination, and big government nanny-ism that makes credit more expensive and less available for hardworking Americans. So radical is the bureau, and so extreme in lacking accountability, that a three-judge panel of the DC Circuit Court of Appeals declared the Bureau’s governing structure unconstitutional.”
A three-judge panel did rule that the structure of the agency was unconstitutional since it is run by a single director who can only be removed by the president for cause.
However, the full appellate court for Washington, D.C. has heard oral arguments on the case, but has not yet ruled on it.
