WASHINGTON–Congress is back in session this week and for the financial services community much of the attention will be on appearances at separate hearings in the House and Senate by Mick Mulvaney, acting director of the CFPB–although a court hearing this week could also change that.
This will be Mulvaney’s first appearance before Congress in his role as acting director. Mulvaney has already taken the unusual step prior to hearings in calling for more regulation of his agency.
“This will be an opportunity for Congress and the Bureau to engage in a dialogue about the agency and its future,” said Ryan Donovan, CUNA’s chief advocacy officer.
CUNA will be sending a letter for the record to both of the hearings. Donovan said the letter will talk about previous CFPB rulemakings and the “adverse impact” on credit unions, and will also urge the CFPB leadership and staff to take time to review finalized rules to see if the carve-out authority shouldn’t be applied.
Donovan said CUNA is “very pleased” with the nearly one-dozen requests for information the CFPB has issued related to its rulemakings. He added CUNA will continue to encourage the CFPB to transfer supervision authority of all CUs, including those over $10 billion in assets, to the NCUA.
“Finally, we will urge the CFPB to effectively use its statutory exemption authority,” said Donovan. “It could not be more clear that Dodd Frank gives the CFPB the full authority to do so. We will also encourage Congress to consider legislation to change the leadership structure of the CFPB to a five-person panel. A multi-member leadership commission was what was originally envisioned.”
Such a panel would enhance the Bureau’s diversity of perspective, said Donovan.
“The sad reality for consumers is both Democrats and Republicans have supported a commission over the years and have walked away from it when convenient to do so,” said Donovan. “We believe stability is needed at the Bureau and a bipartisan five-member commission would bring diversity.”
Letter To Congress
Monday, CUNA, NAFCU and 21 other financial trade associations—including the American Bankers Association and Independent Community Bankers of America—sent a joint letter to Congress in support of HR 5266, the Financial Product Safety Commission Act of 2018, a bill that would transition the leadership structure at the CFPB from a sole director to a bipartisan commission.
The group stated they support a five-person, bipartisan commission, as it would provide a more balanced and deliberative approach to supervision, regulation, and enforcement by encouraging input from all stakeholders.
The current CFPB leadership structure and transition has borne uncertainty for financial institutions providing lending services, which negatively impacts America’s consumers, small businesses, and local economies, the letter stated.
Hearing on CFPB Leadership
Meanwhile, on Thursday, a three-judge panel will hear an appeal by the deputy director of the CFPB that she should be the acting director of the agency instead of the current sitting director.
The hearing will be heard in the U.S. District Court of Appeals for the District of Columbia by judges Judith W. Rogers, Thomas B. Griffith and Patricia Millett. At issue is a lawsuit filed by Leandra English, deputy director of the Consumer Financial Protection Bureau, who is seeking to have the court confirm her as acting director of the agency rather than Mulvaney, who was appointed by President Trump to the position.
As CUToday.info reported here, English was appointed to her current post in November 2017 by outgoing Director Richard Cordray just prior to his resignation. Both Cordray and English have cited the Dodd-Frank Act–which states the deputy director takes over in the absence of the director–in making the move.
Trump, however, countered that the Federal Vacancies Reform Act of 1998 empowers the president to make the appointment, and he named Office of Management and Budget Director Mulvaney to also fill that role.
In January, federal Judge Timothy Kelly denied a request by English to name her the acting director.