House Republicans concerned about consumer bureau's role in foreclosure issues

By Vicki Needham - 06/21/11 03:07 PM ET

House Republicans expressed concerns about a possible lack of transparency at a newly created consumer protection agency and its role in mortgage-settlement negotiations.

Leaders from the House Financial Services and the House Oversight and Government Reform committees sent a letter on Monday to Treasury Secretary Timothy Geithner requesting documents regarding the coordination between the Consumer Financial Protection Bureau (CFPB) and the State Attorneys General regarding investigations into the foreclosure practices of several major banks.

“As we have expressed in previous correspondence with you and in hearings before our respective committees, we remain concerned that transparency and accountability be given the highest priority throughout the government, especially in an agency as powerful and important as the Consumer Financial Protection Bureau,” the lawmakers wrote.

The new request comes after Judicial Watch, a nonpartisan public interest group that investigates government corruption, uncovered e-mails, meeting minutes and other records that show the CFPB has been heavily involved in the negotiations, the letter said.

  During a March 16 subcommittee hearing, Financial Services Chairman Spencer Bachus (R-Ala) questioned Elizabeth Warren, the assistant to the president and senior adviser to the Treasury secretary who is charged with setting up the CFPB, about the propriety of her participation in the mortgage settlement negotiations since the consumer bureau doesn’t officially begin operations until July 21.

Warren responded that the bureau merely provided advice when asked, according to the letter.

  “It appears that the CFPB has been deeply involved in the mortgage servicing settlement negotiations and that its role goes far beyond the mere offering of ‘advice,’” the letter said.

The letter was signed by Bachus and Oversight and Government Reform Chairman Darrell Issa (R-Calif) along with Reps. Shelley Moore Capito (R-W.Va.), Scott Garrett (R-N.J.), Patrick McHenry (R-N.C.), and Randy Neugebauer (R-Calif.), all senior members of the Financial Services Committee.