Mulvaney urges Congress to strip agency's powers

Mulvaney urges Congress to strip agency's powers
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The acting director of the Consumer Financial Protection Bureau (CFPB) asked a House committee Wednesday to rein in the agency’s power to police the financial sector.

Mick MulvaneyJohn (Mick) Michael MulvaneyTrump's latest plan to undermine Social Security Trump says he'll decide on foreign aid cuts within a week Dick Cheney to attend fundraiser supporting Trump reelection: report MORE, who is also the White House budget director, urged the House Financial Services Committee to impose several new restrictions on the bureau. He said lawmakers need to take control of the agency’s funding, make his successors fireable at will by the president and install an inspector general, among other things.

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"It's not accountable to you. It's not accountable to the public. It's not accountable to anybody but itself," Mulvaney said of the CFPB, telling lawmakers to “take back authority as the legislature of the country.”

Republicans showered praise on Mulvaney’s efforts to pull back the CFPB, an agency they’ve long accused of violating the law and abusing its powers to wage a crusade against financial institutions. 

“It is sheer irony and great comic relief to see the wailing and gnashing of teeth of many of my Democratic colleagues who now denounce the unaccountable nature of the CFPB, but only because now a Republican is in control,” said House Financial Services Committee Chairman Jeb HensarlingThomas (Jeb) Jeb HensarlingHas Congress lost the ability or the will to pass a unanimous bipartisan small business bill? Maxine Waters is the Wall Street sheriff the people deserve Ex-GOP congressman heads to investment bank MORE (R-Texas). 

“I ask, ‘Where have you been?’ ”

Democrats who long resisted GOP efforts to change the CFPB ripped Mulvaney for his efforts to ease off its historically aggressive enforcement. Some of them even refused to recognize him as the bureau’s acting chief.

“Mr. Mulvaney is not the acting director of the Consumer Financial Protection Bureau,” said Rep. Maxine WatersMaxine Moore WatersNadler asks other House chairs to provide records that would help panel in making impeachment decision Bank watchdogs approve rule to loosen ban on risky Wall Street trades F-bombs away: Why lawmakers are cursing now more than ever MORE (Calif.), the committee’s ranking Democrat. “He was illegally appointed by President TrumpDonald John TrumpThe Hill's Campaign Report: Democratic field begins to shrink ahead of critical stretch To ward off recession, Trump should keep his mouth and smartphone shut Trump: 'Who is our bigger enemy,' Fed chief or Chinese leader? MORE.”

Even so, Waters said that Democrats needed to press Mulvaney on the “impactful and indeed harmful decisions” he has made in his nearly five months leading the agency.

Trump appointed Mulvaney as acting CFPB chief in November following the resignation of Richard CordrayRichard Adams CordrayWatchdog agency must pick a side: Consumers or scammers Kraninger's CFPB gives consumers the tools to help themselves House rebukes Mulvaney's efforts to rein in consumer bureau MORE (D), the bureau’s first director. Cordray had sought to choose his temporary heir by elevating Leandra English, then his chief of staff, to the deputy director position. 

A federal judge ruled in November that Trump’s appointment of Mulvaney superseded English’s claim to the job as the CFPB's deputy chief. That decision gave Mulvaney free reign to transform the agency he had once sought to eliminate as a member of Congress.

Mulvaney’s major actions include delaying a controversial rule on short-term, high-interest loans, restructuring the bureau’s office for policing lending discrimination and starting a sweeping review of the CFPB’s operations. The goal, he said, is to end what he considers the bureau’s overzealous and harmful history of aggressive fines and lawsuits.

“Regulation by enforcement is done,” Mulvaney said. “Financial services providers should be allowed to know what the law is before being accused of breaking it.” 

Republicans on the panel joined Mulvaney, a former member of the committee, in denouncing the CFPB’s broad power and independence. 

“You are thankfully both a terrible bureaucrat but a great leader,” said Rep. Blaine LuetkemeyerWilliam (Blaine) Blaine LuetkemeyerSenate bill seeks to bring freedom back to banking On The Money: Dems inch closer to demanding Trump's tax returns | Consumer chief pressed to undo Mulvaney's work | IRS says average tax refund up New push to open banks to marijuana industry MORE (R-Mo.).

Mulvaney stressed his commitment to doing nothing beyond enforcing consumer protection laws and fulfilling his obligations as CFPB director. He denied Democratic charges that he is seeking to destroy the bureau from within. He cited as proof his continuation of the 25 lawsuits Cordray filed against lenders accused of fraud or abuse and the more than 100 investigations being conducted by the bureau. 

Other Democrats pressed Mulvaney for signs that he’s abused his position to benefit special interests or crossed ethical lines meant to separate his work at the CFPB and as Trump’s budget director.

“We’re still going after bad actors,” Mulvaney said. “We’re doing it differently than other folks might do it, because elections have consequences.”

Democrats said the fact that Mulvaney had not initiated any of his own actions against banks was proof of his unfitness for the job.

“The clear implication is that the people who were enforcing before are not enforcing anymore,” said Rep. Stephen LynchStephen Francis LynchHillicon Valley: Appeals court rules Trump can't block people on Twitter | Tech giants to testify in House antitrust investigation | DHS set for grilling over facial recognition tech | Commerce to allow sales to Huawei Facebook official responds to Maxine Waters on cryptocurrency project House Democrats call for Facebook to halt cryptocurrency project MORE (D-Mass.). “What the heck are they doing now?”

Mulvaney will appear before the Senate Banking Committee on Thursday. Sen. Elizabeth WarrenElizabeth Ann WarrenGabbard hits DNC over poll criteria for debates The Hill's Campaign Report: Democratic field begins to shrink ahead of critical stretch Keystone XL Pipeline gets nod from Nebraska Supreme Court MORE (D-Mass.), the architect of the CFPB who has emerged as the most vocal critic of Mulvaney, will have a chance to question Mulvaney at the hearing.