MBA supports some tightening of the reins on CFPB
Critics who claim the Consumer Financial Protection Bureau lacks a balanced and constitutional structure may find a powerful ally in David Stevens, president and chief executive of the Mortgage Bankers Association.
Stevens sent a letter to lawmakers this week, saying while the MBA has "consistently supported the (Dodd-Frank) legislation's underlying goal of putting disparate consumer financial regulatory functions under one roof," the MBA chief is backing the Financial Services Appropriations Act of fiscal 2012, which would increase financial and regulatory oversight of the CFPB.
The House Appropriations Committee voted Thursday to cap funding for the CFPB. The committee passed funding proposals for the Treasury Department, Securities and Exchange Commission and other federal agencies. The bill accepted by the committee stipulated the CFPB cannot receive more than $200 million from the Federal Reserve in fiscal 2012 for operational funding. The Fed estimates the CFPB's operating expenses at $500 million.
The Stevens letter supporting appropriations oversight is addressed to ranking members of the House Committee on Appropriations.
Stevens did not bash the CFPB in his letter and he supports aspects of the financial reform.
"The creation of the CFPB, while achieving that goal, did so at the expense of assuring sufficient oversight and appropriate governance of this new and immensely powerful regulatory entity," Stevens wrote.
Stevens said the current structure of the bureau would allow the CFPB to receive its funding directly from the Federal Reserve, removing any type of legislative oversight.
"The appropriations bill would correct this flaw by subjecting CFPB to the regular congressional appropriations process, effective in fiscal year 2013," he wrote in the letter. "It is notable that the legislation does not limit funding for the CFPB (authorizing 'such sums as may be necessary'), but merely places these important budgetary decisions in the hands of Congress, where they belong."
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