Republicans want details on new financial research office's budget

ADVERTISEMENT
Currently, the OFR has an independent budget, and gets its money by tapping the operating revenue of the Federal Reserve. After July 2012, the office will finance itself by assessing fees to the financial services industry.

But it is precisely that funding mechanism that is worrying Republicans, who argued in the letter that the office as is "has the power to set its own budget and may hire without limit at any salary."

Thus far, the OFR has spent $20.5 million and plans to tap the Fed for $64 million more, the lawmakers said in their letter.

While acknowledging that so far the office has operated under budget, the lawmakers nonetheless said they needed more information to justify the funds being requested. The only thing about OFR's operations submitted to Congress thus far was its annual report on recruitment and retention of employees, which came in at fewer than 2,000 words.

Further driving their concern are lingering worries about whether the office has overbroad powers, coupled with the fact that it could become a target for hackers.

"We continue to be concerned about OFR's ability to execute its expansive mission and even whether the mission itself is sound," the members wrote in the letter. "OFR's request for more money — absent more detailed statements as to OFR's budget and its strategic plan — compounds our concerns."

The letter was sent to Richard Berner, who serves as counselor to Treasury Secretary Timothy Geithner.

The OFR has become the latest financial regulator to face a budgetary squeeze from congressional Republicans. Conservative lawmakers have also been fiercely critical of the fact that the Consumer Financial Protection Bureau's budget falls outside the appropriations process, and are blocking the president's nominee to head the agency in the Senate until it is changed. In addition, Republicans have pushed to cut the budgets of regulators like the Securities and Exchange Commission and Commodity Futures Trading Commission, even as those agencies are asking for expanded budgets to help deal with their expanded responsibilities since Dodd-Frank became law.