House committee approves bill to slash CFPB power

The House Appropriations Committee has approved a bill that would make multiple reforms to the Consumer Financial Protection Bureau – including eliminating the agency’s supervisory authority.

The committee approved the Financial Services and General Appropriations bill for fiscal 2018 by a 31-21 vote, according to the Consumer Finance Monitor.  Among the reforms the bill calls for are:

• Bringing the CFPB’s funding under the congressional appropriations process
• Eliminating the agency’s supervisory authority
• Removing its authority for rulemaking and enforcement “with respect to payday loans, vehicle title loans or other similar loans.”
• Removing the agency’s authority to restrict arbitration

The CFPB and its director, Richard Cordray, have long been targets of House Republicans who feel the agency wields too much power. The chairman of the House Financial Services Committee, Jeb Hensarling (R-Texas) recently called on Cordray to either confirm that he will serve out his full term or resign immediately. Cordray is said to be toying with a run for governor of Ohio.

“If Director Cordray wishes to issue midnight rules, to hire or adjust the status of CFPB employees, to obligate CFPB funds, or to accelerate agency investigations, he should first commit to serving his full term,” Hensarling said in a statement. “If he will not do so, the honorable course of action would be to resign and leave such decisions to his successor.”


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