WASHINGTON—Blaine Luetkemeyer (R-MO), a member of the House Financial Services Committee, has introduced legislation that would change the CFPB's governance structure from a single director to a bipartisan commission.
The legislation has support from both credit union trade associations, both of which have filed briefs in a Supreme Court case over the single-director structure.
"NAFCU has long supported a bipartisan commission at the CFPB to provide for more open debate, diversity of thought, and a stable leadership structure that would better serve consumers in the long-run," said NAFCU President and CEO Dan Berger. "We thank Rep. Blaine Luetkemeyer for introducing this important bill, and we look forward to advocating for its passage on Capitol Hill.
"To date, CFPB Director Kathy Kraninger has been receptive, transparent and open to listening to the needs of credit unions. Until Congress acts to change the CFPB's leadership structure, we look forward to continuing to work with Director Kraninger,” continued Berger. “More so, we will continue to staunchly oppose subjecting credit unions to CFPB authority, and we will continue to push for the bureau to exempt credit unions from its rulemakings."
The bill introduced by Luetkemeyer would create a five-person commission, appointed by the president. The members would serve staggered, five-year terms. In addition, it explicitly says the president has authority to remove any member of the commission.
CUNA Response
“The CFPB has the broadest regulatory reach of any financial agency, and consumers, financial institutions and the American economy deserve nothing less than transparency and stability at the CFPB, despite any shifts in the political landscape. We thank Rep. Luetkemeyer for his work on this bill, and we look forward to continued engagement on this solution,” said CUNA CEO Jim Nussle.
Supreme Court Hearing
As CUToday.info reported, last week the Supreme Court heard arguments in a lawsuit brought by Seila Law against the CFPB challenging its single-director structure. The Bureau previously announced it would no longer defend its structure after years of lawsuits and calls to reform it from various stakeholders.
However, in a separate lawsuit also challenging the CFPB's constitutionality, the Fifth Circuit Court of Appeals determined the CFPB's structure is constitutional. Last week the court – which previously ruled the FHFA's structure was unconstitutional – said "the restrictions on the President’s removal authority under the Consumer Financial Protection Act are valid and constitutional." It also highlighted why this is important in relation to the Seila Law case.