Chamber Backs New CFPB Bill, Questions Remain About Agency's Impact
In her first testimony before Congress since taking on the task of advising the newly-formed Consumer Financial Protection Bureau (CFPB), Elizabeth Warren outlined the progress in setting up the agency and offered her vision for its future. We appreciate the opportunity to hear from Ms. Warren and look forward to hearing more from her at our 5th annual Capital Markets Summit two weeks from today. While we agree with Ms. Warren's goal of protecting consumers and providing greater pricing transparency, we remain concerned about the tremendous uncertainty surrounding the Bureau's broad reach, its enforcement powers, and its leadership structure.
As Rep. Bachus noted during this afternoon’s testimony, the CFPB is "probably the most powerful agency that's ever been created in Washington." Because of this, we continue to urge the President to nominate a director and allow this person to go through the full Senate confirmation process. Until we get there, the Bureau will remain in a gray area, effectively under the direction of a single political appointee.
This is why we are standing behind the bill introduced by Rep. Bachus today, supporting his call for a 5-member bipartisan commission to oversee the CFPB, rather than a single director. This is what the American people deserve to ensure proper oversight for an agency that we hope will live up to its mission of protecting consumers and their access to credit without being subject to the political winds of Washington..
We believe there is a right way and a wrong way for the CFPB to operate. The right way involves building an efficient bureau that is well-coordinated both internally and externally with its federal and state partners; improving disclosure by rationalizing conflicting or duplicative paperwork requirements; and targeting bad actors, which is good for consumers and ensures a healthy, competitive market.
What we can't afford is an agency that adds to the regulatory duplication and overlap by failing to establish transparent lines of jurisdiction between federal partners like the FTC and FSOC; that makes broad policy decisions leading to fewer or more expensive choices for consumers and inhibiting the ability of small businesses to create jobs; or that regulates Main Street businesses that only offer limited financing as part of their core business.
We provided our recommendations in more detail as part of a letter to Treasury Secretary Geithner on March 1.
This is not about politics. This is about protecting consumers while bringing certainty to the American business community so we can focus on creating jobs. While the vision of the CFPB may seem relatively clear, the job requires a very careful balancing act.