WASHINGTON–A new report from the Government Accountability Office (GAO) has found changes made during a reorganization of the CFPB have led to a loss of fair lending expertise at the agency, as well as reduced transparency and difficulty in assessing progress toward fair lending goals, according to the congressional watchdog.
The GAO report said the 2018 realignment at the CFPB led to a reshuffling of its fair lending activities, with the result being expertise was reallocated throughout the agency.
According to GAO, when the Bureau conducted the reorganization in 2018, it moved its fair lending office from the supervision, enforcement and fair lending division to then-Director Kathleen Kraninger’s office, reallocating some of the fair lending office’s responsibilities along the way.
The Specifics
Among the other specifics cited, the GAO said the CFPB:
- Moved responsibility from specialist attorneys in the fair lending office to generalist attorneys in its enforcement office
- Shifted subject matter expertise and exam support from dedicated fair lending office supervision staff to a new team in the office of supervision policy
- Reassigned responsibility for selecting institutions for fair lending exams and identifying enforcement priorities from the fair lending office to supervision offices and the office of enforcement at the Bureau
Key Practices Not ‘Sustained’
“As CFPB planned and implemented the reorganization, it did not substantially incorporate key practices for agency reform efforts GAO identified in prior work – such as using employee input for planning or monitoring implementation progress and outcomes,” the GAO report states.
In addition, the GAO said it also identified “challenges related to the reorganization” that included loss of fair lending expertise and specialized data analysts. The Bureau has indicated those losses may have “contributed to a decline in enforcement activity in 2018,” according to the report.
The Overall Result
The overall result, GAO stated, is the Bureau has not assessed how well the reorganization met its own goals or how it affected fair lending supervision and enforcement efforts.
“Collecting and analyzing information on reorganization outcomes would help CFPB determine the impact of the changes and identify actions needed to address any related challenges or unintended consequences,” the GAO report noted.