Consumer Financial Protection Bureau
I wanted to write about something that has likely slipped under the radar of current events, which seems to be pretty easy to do these days. The Consumer Financial Protection Bureau (CFPB) which oversees the regulation of auto loans, credit cards, and other forms of consumer credit is vastly reducing its enforcement activities, thanks in part to the Congressional Review Act (CRA). This comes at the direction of interim head of the department, Mick Mulvaney, as Republicans look to roll back consumer protections in order to boost the economy. Here’s a quick look at the goals for this administration in regards to curbing the CFPB.
Shrink the CFPB’s reach, reducing the spheres over which the agency can regulate provide protections for consumers.
Curb its enforcement powers so that the agency can’t be as effective in the areas that it does have jurisdiction over.
Make the agency more accountable to lawmakers and the president.
Regardless of how you feel about whether the economy needs boosting, I think we can all agree that people should have some protection against predatory lenders and discriminatory car loans. This is made possible by the CRA which allows the Senate to roll back a vast amount of regulations. This is because normally there’s a review window for all new regulations, but once that’s passed, it can no longer be easily repealed. However, many agencies don’t submit regulations for formal rules because it would quickly become an administrative nightmare. That means that the review window never opened, which allows the Republican controlled senate to go back and repeal those regulations with a simple majority. This means that the CFPB’s regulations are likely to continue to be rolled back with little or no opposition.
Given how drastically Mulvaney wants to reduce the oversight of the CFPB and the continuing trend of regulation roll back, it underscores the need for people to find someone they trust for financial advice. If you have questions about the CFPB or want some advice on credit decisions, send me an email.
