Elizabeth Warren fends off GOP critics at Oversight hearing

ADVERTISEMENT
"I am less certain that is true," she said. "Let's get out there and try some real disclosure ... I believe in markets."

He pressed, asking Warren if she knew of a specific financial product in existence that should be banned.

"I don't know of one, sir," she responded. "But if you have a particular suggestion, we'd be happy to take a look at it."

When later asked whether the CFPB had no plans to ever ban a financial product, Warren clarified.

“We have no present intention to ban a product, but we don’t stop worrying about what’s out there, and the world keeps changing," she said. "It is a tool in the toolbox."

Rep. Trey Gowdy (R-S.C.) followed suit, referring to an article Warren wrote in 2007 that set in motion the idea of a federal agency aimed at protecting consumers, which blasted a number of lending practices such as payday and subprime lenders. He pressed Warren on whether she wanted to ban such products.

"There's a lot of space between banning a product and making a product clearer to consumers," she said. "We need to be concentrating on where we can best make changes in the marketplace.”

But she was not shy about defending the powers the CFPB will bring to the table once active.

"These are very large and powerful financial institutions who hire armies of lawyers to design financial products that can’t be read by average American families," she said. "We need some pushback."

She added that, if necessary, the CFPB will sue banks that do not follow consumer protection laws.

Chairman Darrell Issa (R-Calif.) said Freedom of Information Act (FOIA) requests for CFPB documents had been excessively redacted. He held up a page sent out under FOIA that was completely blacked out.

"When someone redacts something so you don’t know what was redacted ... that’s considered excess under FOIA," he said.

For her part, Warren said those requests were put through the Treasury Department.

"I've never seen this," she said.

She struck a deferential tone throughout the hearing to lawmakers, perhaps eager to avoid a repeat of her last appearance before Congress when she and McHenry argued over the length of her testimony.

Rep. Jason Chaffetz (R-Utah) pressed Warren on specifics available to the public on the CFPB's budget, which could exceed $500 million in fiscal 2012.

"You seem to be hiding the details of how you got that number," he asked her.

"Congressman, no one's hiding anything," she responded. She added that the CFPB is working on getting that information to the public.

Democrats worked to puff up Warren and her work while taking on GOP critics.

Rep. Jim Cooper (D-Tenn.) chastised members for engaging in a "partisan food fight" over the CFPB, adding that she had been used as a "partisan punching bag" by critics.

"This lady's trying to do the right thing," he said.

There were fireworks at the hearing before Warren had said a word, as members sparred over an effort to subpoena large mortgage servicers. Ranking member Rep. Elijah Cummings (D-Md.) surprised Issa with a motion requesting the committee subpoena five mortgage servicers that have not responded to previous requests for documents tied to their foreclosure proceedings.

Issa ruled the motion would be out of order for the hearing at hand but had to break for five minutes to consult a parliamentarian after the ruling was challenged by Rep. John Tierney (D-Mass.).

Issa came back and maintained the motion was out of order, but acquiesced after Tierney insisted it was germane because the motion would call as witnesses custodians of the sought-after documents.

"What about the English language, sir, don't you understand?" he asked after Issa resisted the argument. 

The motion was later pulled after Issa agreed to a joint letter-writing campaign to large mortgage servicers asking for information tied to treatment of active military members, as well as a consultation with the Veterans Affairs Committee for whatever information they have uncovered.

This post updated at 1:41 pm.

More in Finance

Barney Frank changes tune on rule at center of funding fight

Read more »