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CBA-Led Coalition Urges Congress To Revamp CFPB Leadership Structure
WASHINGTON – In a new letter sent to Rep. Blaine Luetkemeyer, Ranking Member of the Subcommittee on Consumer Protection and Financial Institutions on the House Financial Services Committee, nearly thirty trade groups expressed strong support for H.R. 4773, the Consumer Financial Protection Commission Act, which would transition the governance structure of the Consumer Financial Protection Bureau (CFPB) from a sole director to a five-person, bipartisan commission. The CBA-led coalition includes nearly thirty trade associations representing thousands of banks, credit unions, financial institutions, and businesses of all sizes.
In the letter, the trades outline the negative impact the current leadership structure at the CFPB has had over the last decade, due largely to the scope and influence of its single director who is subject to the political pendulum of Washington:
“This uncertainty is not only borne by financial institutions providing significant lending services, but it negatively impacts America’s consumers, small businesses, and our local economies. Dramatic shifts in the CFPB’s philosophy and approach with each change in presidential administration make it difficult for lenders and small businesses to plan for the future.”
The current leadership structure of the CFPB has resulted in ever-changing rules of the road over the last decade, depriving consumers of the high level of protections they deserve. To ensure the Bureau is delivering on its original intent, the letter encourages lawmakers to replace the governance of a single director with a commission, stating:
“A Senate confirmed, bipartisan commission will provide a balanced and deliberative approach to supervision, regulation, and enforcement by encouraging input from all stakeholders. […] Moreover, it is the traditional structure for a financial services regulator as this leadership model provides some moderation and stability regardless of who is in the White House.”
The letter also identifies the strong public support for replacing the single director structure at the CFPB:
“The American people recognize the benefit of having certainty and stability from a bipartisan commission at the CFPB. A Morning Consult poll shows that by a margin of three to one, registered voters in eight states support a bipartisan commission over a sole director, with only 14 percent of those polled stating they prefer to keep the Bureau’s current leadership structure.”
CBA’s Advocacy For Reform At The CFPB
Throughout the course of the last decade, CBA has remained a leading advocate for revamping the flawed leadership structure at the CFPB. Upon introduction of H.R. 4773 last month, CBA President and CEO Richard Hunt wrote:
“Thank you to Congressman Luetkemeyer for reintroducing legislation to alter the flawed leadership structure of the CFPB, which holds enormous influence over an industry affecting millions of Americans and is currently led by an unaccountable sole director. Since its inception, revolving leadership at the CFPB has caused significant uncertainty for consumers and the market, as each new administration pursues their own regulatory priorities. CBA has long advocated for replacing the single director with a Senate-confirmed, five-person commission to lead the Bureau in a transparent manner.”
In 2019, Hunt underscored the need for consistent regulations and a less political CFPB in an American Banker op-ed, and reaffirmed the importance of implementing a bipartisan commission to ensure the Bureau is delivering on its mission of protecting consumers in a letter to the House Financial Services Committee. CBA also filed an amicus brief with the U.S. Supreme Court in the Seila Law LLC v. Consumer Financial Protection Bureau case in 2019.
You can read the full letter HERE.