Bipartisan push begins in Congress to change CFPB leadership to commission

Not the first time for such an effort

While some congressional Democrats and Republicans are fighting over who’s supposed to be serving as the director of the Consumer Financial Protection Bureau right now, a handful of their colleagues want to do away with the bureau’s single director structure altogether.

This week, a bipartisan group of two Republicans and two Democrats in the House of Representatives introduced a bill that would replace the single director of the CFPB with a bipartisan commission.

The bill, which was introduced by Rep. Dennis Ross, R-Florida, is called the Financial Product Safety Commission Act of 2018.

Joining Ross, who is the Senior Deputy Majority Whip, in sponsoring the bill are Reps. Kyrsten Sinema, D-Arizona; Ann Wagner, R-Missouri; and David Scott, D-Georgia.

Under the legislation, the CFPB would be renamed the Financial Product Safety Commission and would led by five commissioners, instead of one director as it is today.

The leadership structure of the CFPB has long been an issue, with court battles going on even today over the leadership of the agency.

Many Democrats on Capitol Hill Democrats support the cause of Leandra English, who was former CFPB Director Richard Cordray’s handpicked choice to lead the bureau after he stepped down.

Republicans, on the other hand, support Mick Mulvaney, who also has the support of President Donald Trump. Trump named Mulvaney interim CFPB director after Cordray stepped down.

English fought back against Trump, suing Trump and Mulvaney in federal court over Mulvaney’s appointment, but after federal judges twice supported Trump’s authority to name an interim CFPB director, Mulvaney has been acting as interim director of the CFPB ever since.

The issue of how the CFPB leadership should be structured is another issue that’s been fought over for some time.

Last year, Sens. Deb Fischer, R-Nebraska; John Barrasso, R-Wyoming; and Ron Johnson, R-Wisconsin, introduced a similar bill that would have replaced the single director of the CFPB with a five-member bipartisan committee.

According to Fischer's office, that was actually the third version of this bill, which she previously introduced in each of the previous two congressional sessions to no avail.

The move to change the CFPB from a single director to a bipartisan commission also has support from more than 20 of the housing industry’s largest trade groups.

Last year, the groups sent a letter to the leadership of the appropriations committees in both the House and Senate, asking for Congress to pursue legislation that would allow a bipartisan commission to run the CFPB.

The letter was signed in part by the American Bankers Association, the American Land Title Association, Community Mortgage Lenders of America, the Credit Union National Association, the Independent Community Bankers of America, the Mortgage Bankers Association, the National Association of Realtors, and others.

Now, the push for a bipartisan commission starts again, courtesy of Ross’ bill.

“The idea that civil servants in positions of immense power should be isolated from debate and protected from dissent is antithetical to our nation’s founding principles,” Ross said in a statement.

“Our system of governance is rooted in the belief that robust competition for ideas and vigorous engagement between those with whom we disagree, is the best way to make laws and regulations and to serve the American people,” Ross continued. “As one of the most powerful agencies ever created, the CFPB should not be exempt from this principle of good governance, and, with this legislation, we can ensure that it no longer will be – regardless of who holds the White House.”

Under the legislation, the leadership of the CFPB would be constructed as a bipartisan commission, with no more than three members from a single political party.

The members would be appointed by the president and approved by the Senate. Commissioners would be required to be citizens of the U.S. and have “strong competencies and experiences related to consumer financial products and services.”

The members would serve five-year terms, which would initially be staggered to allow turnover in the early stages of the commission. “The members of the Commission shall serve staggered terms, which initially shall be established by the president for terms of 1, 2, 3, 4, and 5 years, respectively,” the legislation states.

Members of the commission would be removable by the president “for inefficiency, neglect of duty, or malfeasance in office.” Currently, the director of the CFPB is only removable “for cause.”

In statements, both Wagner and Sinema discussed their reasons for supporting the bill, although each has a slightly different view of the CFPB’s current structure.

“As Chairman of the Oversight and Investigations Subcommittee, I saw firsthand the abuses and lack of accountability at the CFPB under the leadership of Former Director Richard Cordray,” Wagner said. “The Financial Product Safety Commission Act of 2018 provides a layer of stability and transparency for an agency that has lacked both. I commend my good friend from Florida, Dennis Ross for his leadership and support on this issue.”

Sinema, on the other hand, noted that the bureau should not be “subjected to the whims” of either party.

“We need a watchdog that looks out for everyday Arizonans and puts consumer protection first,” Sinema said. 

“That’s why I’ve sponsored this bill under both Democratic and Republican presidents. CFPB’s ability to carry out its mission should not be subjected to the whims of any one person or political party,” Sinema added. “Our bill requires qualified people in both parties to work together to get things done – that’s how we deliver results for Arizona that stand the test of time.”

The bill has the support of several financial groups, including the ABA, the ALTA, the Consumer Bankers Association, the Credit Union National Association, the National Association of Federal Credit Unions, and the Financial Services Roundtable.

The bill was introduced this week and sent to the House Financial Services Committee for consideration.

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