CFPB ‘limits consumers’ options’ – Shelby

by Ryan Smith08 Apr 2016
The chair of the Senate Banking Committee had harsh words for the director of the Consumer Financial Protection Bureau at a hearing Thursday.

Sen. Richard Shelby (R-Ala.) criticized the CFPB’s use of enforcement actions to set market standards rather than a rule-making process, its perceived lack of accountability, and many aspects of the Dodd-Frank Act itself.

“Unfortunately, the drafters of Dodd-Frank immunized the Bureau from any meaningful congressional influence, leaving it free to engage in questionable practices and unreasonable expansions of its jurisdiction,” Shelby said. ““The only effective restraint available now resides in the courts. Fortunately, this week a federal court of appeals has directed the CFPB to defend the constitutionality of its structure.”

Shelby said the CFPB’s actions have actually undermined its mission.

“There is now growing concern that, despite the Bureau’s mission, its rules and regulations actually restrict access to credit, increase costs, and deny financial products to the consumers who need them,” he said. “Last year’s survey by the Federal Reserve found that 47% of U.S. households are unable to come up with $400 in emergency funds without selling something, going into credit card debt, or using a short-term loan.

“By targeting some of these products in its rulemakings, the Bureau may be blocking access to the very financial services many Americans may need in a crisis,” Shelby added. “Consumer protection should not mean limiting consumers’ options by substituting the Bureau’s judgment for the consumers’.”

COMMENTS

  • by Griff | 4/8/2016 11:26:26 AM

    Well the head of the senate banking committee is not wrong, but i wish Congress would stop whining and do something about it. I feel like they are just stirring the pot when they have the power to fix it. Repubs run both the house and senate, do something!

    And, btw, this dude has no idea how much the cfpb has made mortgage lending more difficult for borrowers to navigate. Are some of the problems deal breakers, no, but having folks wait days to close or get a slew of mortgage estimates and closing disclosures only to be followed lastly with a settlement sheet that does not even mirror the other two is just downright confusing to them.

  • by | 4/8/2016 11:56:38 AM

    CFPB is clearly a rogue agency, unsupervised. Answering to nobody.
    Should be abandoned.
    R Uhl

  • by Rod M | 4/8/2016 2:07:49 PM

    I think the mood is perfect to possibly get hr3393 passed soon. We'll be lobbying our state senators and representatives Tuesday after hearing Mondor speak on Monday. My first meeting is with Senator Shelby on Tuesday. I really like what he's been saying in the last 2 hearings I've watched. I believe our Alabama rep's in Washington understand and agree with us on industry issues.

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