WASHINGTON–A Senate version of legislation that would change the leadership structure at the Consumer Financial Protection Bureau from a single director with a five-person, bipartisan commission has been introduced by Sen. Deb Fischer (R-NE).
A House companion bill was introduced in March by Rep. Blaine Luetkemeyer (R-MO).
Similar legislation has also been introduced in several prior sessions of Congress, but it has not advanced.
CUNA Response
“Sen. Fischer’s legislation will bring stability and strength to the CFPB by creating a leadership structure that ensures all voices are heard,” said CUNA Chief Advocacy Officer Ryan Donovan. “This legislation is an important step to reestablishing the Bureau as it was initially envisioned—with input from CUNA and the leagues—back in the original, House-passed version of the Dodd-Frank Act in 2010. We look forward to working with Congress to finding a path forward on this critical legislation.”
NAFCU Response
“By establishing a bipartisan commission at the CFPB, consumers would benefit from more robust debate, diversity of thought, and a stable leadership structure at the agency,” said NAFCU President and CEO Dan Berger. “We thank Senator Deb Fischer for introducing this important legislation, and we encourage Congress to swiftly pass this bill. Until the CFPB's leadership structure is reformed by Congress, we look forward to continuing to work with Director Kathy Kraninger. Over the years, she has been responsive, transparent, and receptive to the needs of credit unions.”
Supreme Court Review
The Senate legislation comes as the U.S. Supreme Court is expected to release a decision in Selia Law v. the CFPB, lawsuit challenging the constitutionality of the CFPB being led by a single director removable only by cause.
CUNA noted it has filed an amicus brief calling on the U.S. Supreme Court to vacate a title of the Dodd-Frank Act, then delay implementation by a year in order to give Congress time to make the necessary legislative changes.
Other Letters Sent
Letter on PPP Forgiveness
CUNA wrote to the House Small Business Committee to seek Congressional action to protect borrowers that carried out the Paycheck Protection Program (PPP) in good faith from any liability stemming from the structure and design of the program. CUNA recommends Treasury and the SBA simplify the forgiveness application process for loans under $350,000, and should consider “making forgiveness of these loans automatic or require a simply good faith certification that the funds were spent on forgivable expenses.”
“The complexity of the forgiveness process presents an even greater challenge for small business as they have fewer resources to deploy on an overly complex application process. Moreover, feedback from our members indicates that the forms will likely require help from outside accountants and even attorneys for most businesses,” CUNA President/CEO Jim Nussle wrote in the letter. “This is an expense many of the smallest businesses cannot afford. Creating an overly complex forgiveness process would seem to be the antithesis to the spirit of a program designed to rapidly deploy resources to small business especially when the expectation is that the funds appropriated to PPP were never expected to be repaid.”
Letter to CFPB
In a separate letter, CUNA said it shared concerns about the CFPB management of its consumer complaint database in a letter to the Bureau. CUNA responded to a CFPB request for renewal of its Consumer Response Company Response Survey, which is designed to collect additional consumer feedback at the end of the consumer complaint process.
“CUNA also urges the CFPB – as we have for several years – to take appropriate steps to verify the legitimacy and accuracy of a consumer’s complaint and/or compliment prior to any public disclosure, publication, or evidentiary use in the supervisory or rulemaking process,” CUNA Senior Director of Advocacy & Counsel Alexander Monterrubio wrote.
Letter About Fed
The Federal Reserve’s work has boosted confidence in the financial system in the wake of the COVID-19 pandemic, CUNA wrote to the Senate Banking Committee.
The committee, along with a separate committee in the House, heard semi-annual testimony from Federal Reserve Board Chairman Jerome Powell this week.
“The unprecedented shutdown of the American and world economies has led to economic uncertainty for individuals and businesses of all types. Changes to regulations and the creation of new lending programs by the Board to provide loans to businesses will help individuals and business weather the storm… For credit unions these changes have helped to keep member loan demand fairly steady and mortgage pipelines in particular have been near capacity,” the letter reads. “Near-record numbers of members have refinanced into lower-rate mortgages and effectively freed up cashflow to meet daily needs and build precautionary savings.”
Other Comments
CUNA also offered comments on several recent Fed actions, including:
- Fully supporting the March 15 decision to reduce reserve requirement ratios of transaction accounts, as well as the April 24 interim final rule deleting the six-account-transfer-per-month limit
- Recognizing the quick creation of the Paycheck Protection Program Liquidity Facility to provide liquidity to eligible financial institutions making PPP loans
- Launching and making needed changes to the Main Street Lending Program, which supports lending to small and medium-sized businesses that were in sound financial condition before the onset of the pandemic.