House GOP renews attacks on 'unbridled' consumer bureau

House Republicans went on the attack Thursday against President Obama’s consumer watchdog after allowing his testimony for the first time in nearly six months.

GOP members of the House Financial Service Committee in April barred the testimony of Richard Cordray, the director of the Consumer Financial Protection Bureau (CFPB), to reflect their position that his recess appointment was unconstitutional.

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The fight over Cordray’s legitimacy ended in July, when the Senate confirmed him as CFPB director. But Republicans on Thursday said that vote has done nothing to assuage their concerns about a lack of accountability at the watchdog agency.
 
“The CFPB is arguably the single most powerful and least accountable federal agency in the history of America,” said Rep. Jeb Hensarling (R-Texas), the committee’s chairman.
 
“In many respects the CFPB is uniquely unaccountable even to itself, since it is fundamentally not an it, not a they, only a he,” he added, describing a “unilateral, unbridled and unparalleled” amount of power that has been granted to Cordray as the director of the agency.

Republicans and opponents of the bureau have claimed that a committee or board would provide better, more accountable leadership at the CFPB.
 
“We still continue to — and I still continue to — believe that creating rules and having buy-in from a committee would actually better serve the consumer and the institutions that are set up to serve the consumer,” said Rep. Shelley Moore Capito (R-W.Va.).

In recent months, the CFPB has finalized new restrictions on mortgages aimed at making sure borrowers are able to pay back their loans. It has also extended its oversight to student loans and debt collection and has explored taking action on payday lenders.
 
Some lawmakers have expressed concerns about the way that the bureau collects consumers’ financial information in order to determine which segments of the market need new regulations.
 
“While your accomplishments are significant, issues such as data-collection practices continue to need your attention,” said Rep. Maxine Waters (Calif.), the top Democrat on the committee.
 
“CFPB is a data-driven agency,” she added. “As you know, Dodd-Frank specifically prohibits the CFB from gathering or analyzing any information that is personally identifiable. I trust you’re carefully adhering to the letter of the law.”
 
Rep. Scott Garrett (R-N.J.) openly accused the agency of “secretly looking into the private papers of Americans.”
 
Republicans pressed for specific details about the number of Americans whose information the CFPB is tracking, but Cordray responded that his agency looked at broad trends, not individual behavior.

“Our issue is we have to oversee the financial sectors, we have to see the pattern of how they treat their customers,” Cordray said.

That did not satisfy his critics.

“What I think America deserves is the transparency that you’re promised,” said Rep. Sean Duffy (R-Wis.). “You come in and you stonewall. You try to explain but never do we get answers. Never does America get answers.”
 
Republicans have long clashed with Cordray, who was originally put in place to lead the CFPB by a recess appointment from President Obama. Federal courts have since ruled that the Senate was not technically in recess at that time, a question that the Supreme Court will resolve in its upcoming session.
 
Looking to one of those court rulings, which voided Obama’s appointments to the National Labor Relations Board made on the same day, Hensarling declared that Cordray was not the legitimate leader of the CFPB and prohibited him from testifying on its behalf.
 
Democrats called the earlier blacklisting of Cordray an empty partisan gesture.
 
“Your presence before this committee is long overdue, particularly after the nearly six months of Republican obstruction that has threatened consumer protection in order to score certain political points,” Waters told Cordray.
 
Republican lawmakers complained that the deputies sent to testify in Cordray’s stead during the last several months were unresponsive to their questions.
 
“I know that the agency and you yourself take great pride in the commitment to transparency and accountability and frequently speak about the number of appearances that you and your staff has had before the committee, but it is not really a questions of quantity, it is a question of quality,” Hensarling said. “Members of your staff can be frequently unresponsive to our inquiries.”
 
Waters said that the lack of response was a consequence of the Republicans’ own maneuvers.
 
“If you had not been blocked from appearing,” she told Cordray, “we would not have had to rely on other people.”
  
There will be more time for questions in just a few weeks; Cordray said that he would be back to testify before the committee next month.