House Financial Services Committee Chairman Rep. Jeb Hensarling, R-TX made waves earlier this year when he announced a Republican-crafted plan to repeal the Dodd-Frank Wall Street Reform and Consumer Protection Act and replace it with a “pro-growth, pro-consumer” alternative.
Many of the tenets of the Republican plan, called the Financial CHOICE Act, were later echoed by the Republican Party’s national platform, adopted during its convention in July.
Included in the Financial CHOICE Act (“CHOICE” in this instance stands for “Creating Hope and Opportunity for Investors, Consumers and Entrepreneurs”) is an end to “too-big-to-fail bailouts, dramatic reforms to the Consumer Financial Protection Bureau, and an overhaul of a financial regulatory system that is choking the country’s economic recovery.
Now, the Financial CHOICE Act is about take one step closer to becoming reality.
The Republican arm of the House Financial Services Committee announced Thursday that the Committee will begin meeting next week to discuss the Financial Choice Act.
Specifically, the Committee will begin debating the Financial Choice Act on September 13. Included in that discussion will be the addition of possible amendments to the bill and perhaps a vote on the legislation.
If the bill passes out of the Committee, it would then go to the full House of Representatives for a vote.
The bill is facing a steep hill to becoming law though, especially with a Democrat in the White House for at least another few months, but the bill provides a view of just different the financial landscape could be if the country were under Republican Party leadership.
If passed, the Financial CHOICE Act would “end taxpayer-funded bailouts of large financial institutions; relieve banks that elect to be strongly capitalized from ‘growth-strangling regulation’ that slows the economy and harms consumers; and impose tougher penalties on those who commit fraud as well as greater accountability on Washington regulators.”
The Financial CHOICE Act would overhaul not only the CFPB, but its leadership structure as well.
According to the executive summary of the bill, the Financial CHOICE Act would actually change the name of the CFPB to the “Consumer Financial Opportunity Commission,” and establish a new mission for the consumer watchdog of not only protecting consumers but also ensuring competitive markets.
Under the Republican plan, CFPB Director Richard Cordray would be replaced by a bipartisan, five-member commission that would be subject to congressional oversight and appropriations.
“The CFPB may arguably be the single most powerful and least accountable Federal agency in the history of our nation,” Hensarling said in June. “The CFPB Director – one man – has the unbridled and unprecedented power to unilaterally declare virtually any mortgage, credit card or bank account ‘unfair’ or ‘abusive’ at which point Americans can’t have it – even if they need it, want it, understand it and can afford it.”
Additionally, the Financial CHOICE Act would:
- Provide for election to be a strongly capitalized, well-managed financial institution
- End “too big to fail” and bank bailouts
- Empower Americans to achieve financial independence by fundamentally reforming the CFPB and protecting investors
- Demand accountability from financial regulators and devolve power away from Washington
- Demand accountability from Wall Street through enhanced penalties for fraud and deception
- Unleash opportunities for small businesses, innovators, and job creators by facilitating capital formation
- Provide regulatory relief for Main Street and community financial institutions
Again, the House Financial Services Committee is set to consider the bill beginning September 13.