The Acting Director of the Consumer
Financial Protection Bureau (CFPB) presented the Bureaus semi-annual report to
Congress on Monday. The report, which
details CFPB's work through the end of the 2017 Fiscal Year, was not the main
event.
Mick Mulvaney, who holds the temporary
position in the CFPB along with being director of the Office of Management and
Budget (OMB), prefaced the report with a memo suggesting Congress make changes
that will fundamentally alter the mandate and structure of the agency.
Mulvaney, the legality of whose
appointment is being challenged in court, had harsh words for the Bureau. He states
that it has been evident since the Dodd-Frank Act, which created CFPB, was enacted
that it was "far too powerful and with precious little oversight of its activities." Dodd-Frank. he said, set up the bureau's
director to wear three hats; a one-man legislature empowered to write rules that
bind parties in new ways; an executive officer over whom the President has only
limited control, and an appellate judge presiding over the Bureau's in-house
court-like adjudications. He said this combining
of all three branches of government was, in the words of James Madison and the
Federalist Papers, "the very definition of tyranny."
The power wielded by the director "could
all too easily be used to harm consumers, destroy businesses, or arbitrarily
remake American financial markets," he said.
The temptation of power is strong, and laws should be written to
restrain that human weakness, not empower it.
Mulvaney, who as a member of Congress
argued for the elimination of CFPB, made the following suggestions for legislative
action:
1. Fund
the Bureau through Congressional appropriations;
2.
Require
legislative approval of major Bureau rules;
3.
Ensure
that the Director answers to the President in the exercise of executive
authority; and
4.
Create
an independent Inspector General for the Bureau.
The report itself set forth the following
accomplishments:
-
During
FY2017 the Bureau handled approximately 317,200
consumer complaints. The most-complained-about products or services were debt
collection at 27 percent of complaints, credit reporting at 27 percent, and
mortgages at 13 percent. Approximately 80 percent of all consumer complaints
were submitted through the Bureau's website. Companies have responded to
approximately 93 percent of complaints sent to them for response during the period.
-
Released
Data Point: Becoming Credit Visible which
explored the means by which consumers transitioned out of credit invisibility.
-
Enacted
two "significant" final rules; the first, Arbitration
Agreements, will not go into effect because Congress adopted a joint
resolution of disapproval, signed by the President. The second was Payday, Vehicle Title, and Certain High-Cost
Installment Loans.
-
Released
seven "less significant" final rules, including amendments to the Truth-in-Lending
Act, RESPA, and the Mortgage Servicing Act.
Subsequent to the appointment of Mulvaney, the Bureau
has issued a dozen Requests for Information about existing Bureau rules and
operations and has opened rulemaking to reconsider the aforementioned Payday Loan
rule (and postponed its implementation until 2019). It has also opened rulemaking to reconsider certain
aspects of the Bureau's 2015 rule titled Home Mortgage Disclosure Act
(Regulation C), which could involve issues such as the institutional and
transactional coverage tests and the rule's discretionary data points.