Bipartisan House bill would replace consumer director with panel

Bipartisan House bill would replace consumer director with panel
© Greg Nash

A bipartisan group of House members on Wednesday released a bill that would replace the director of the controversial Consumer Financial Protection Bureau (CFPB) with a five-person commission.

The bill from Reps. Dennis RossDennis Alan RossIsraelis and Palestinians must realize that each needs to give, not just take Court opens door to annexing the West Bank — and the consequences could be disastrous The problem with Trump's Middle East peace plan MORE (R-Fla.), Kyrsten Sinema (D-Ariz.), Ann WagnerAnn Louise WagnerSEC's Clayton demurs on firing of Manhattan US attorney he would replace Trump, GOP go all-in on anti-China strategy House passes massive T coronavirus relief package MORE (R-Mo.) and David ScottDavid Albert ScottThe Hill's Campaign Report: Biden marks 4th anniversary of Pulse nightclub shooting Georgia Rep. David Scott wins primary, avoiding runoff after final tally Georgia Rep. David Scott heads to runoff MORE (D-Ga.) would rename the CFPB and replace its director with a bipartisan panel.

While the bill would easily pass the House, it would likely be filibustered in the Senate by Democrats who have protested changes to the CFPB.

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Under the bill, the CFPB would become the Financial Product Safety Commission, directed by a panel appointed by the president. No more than three commissioners could be from the same political party, and the president could remove a member for “inefficiency, neglect of duty, or malfeasance.”

The bill is an attempt to rein in the CFPB director’s sole control over the agency’s extensive authority. Republicans have long insisted that the bureau, opened in 2013, is too powerful, immune from congressional oversight and dependent on the whims of the director.

The CFPB issued a slew of regulations and pursued aggressive actions against financial companies suspected of wrongdoing under former director Richard CordrayRichard Adams CordraySupreme Court ruling could unleash new legal challenges to consumer bureau Supreme Court rules consumer bureau director can be fired at will Poll: Biden, Trump neck and neck in Ohio MORE. While Democrats praised Cordray for his tough oversight of lenders, Republicans and the financial sector argued the CFPB overstepped its boundaries.

Supporters of the CFPB commission say a five-person panel would provide more stability for the agency and prevent any political ideology from dominating the agenda. Acting CFPB Director Mick MulvaneyMick MulvaneySupreme Court ruling could unleash new legal challenges to consumer bureau Bottom line White House goes through dizzying change in staff MORE, a staunch conservative, has enraged liberal former allies of the bureau by scaling back the agency’s operations.

Democrats say installing a CFPB commission would hinder the agency from fulfilling its mission, laid out in the Dodd-Frank Act, to protect consumers from risky financial products and fraud. They insist that Republicans could kneecap the CFPB by refusing to confirm commissioners.

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The bill seeks to limit those concerns by allowing the commission to approve all agency actions with just two of five commissioners in place.

Major financial sector lobbying groups that have sought to rein in the bureau endorsed the bill shortly after its release.

The Consumer Bankers Association, National Association of Federally-Insured Credit Unions and Credit Union National Association praised the measure in Wednesday statements.