Financial Services Roundtable Urges CFPB Overhaul

The Financial Services Roundtable (FSR), a lobbying and advocacy organization, is joining a number of Washington lawmakers calling for greater transparency and oversight to the Consumer Financial Protection Bureau (CFPB).

In a letter to a U.S. House of Representatives subcommittee, FSR commended the House Committee on Financial Services for its recent support of 11 different bills that would reform the way the CFPB does business.

“We are pleased to support the legislation before the Committee which seeks to bring balance to consumers and the agency, efficiency for entities subject to CFPB jurisdiction and accountability and transparency for all stakeholders,” wrote FSR President and CEO Tim Pawlenty in the letter. “These reforms will reduce the risk of unintended consequences on the market for consumer financial products.”

Despite having worked with the CFPB on a variety of issues over the past three years, the FSR remains concerned about the agency’s governance structures.

“The combination of unprecedented authority, a single decision maker and independent funding leaves the CFPB with less accountability and oversight than many other agencies,” Pawlenty wrote.

CFPB’s practice of issuing guidance instead of following a formal rule-making process like other federal agencies was another area of concern for FSR and House Committee members alike.

The Committee, headed by Chairman Jeb Hensarling (R-TX), has long heralded a need to bring significant reforms to the CFPB. 

In 2011, three bills—largely supported by Republicans—advanced through the House’s Financial Services Committee that aimed to “defang” the authority of the Bureau.

The 11 bills introduced last month vary in their missions to bring change to the CFPB, including the elimination of the agency’s Civil Penalty Fund and creating a consumer “opt-out” list for data collected by the Bureau, among others. 

“Again, we have heard from many that the CFPB is a unique agency and, regrettably, they are part of a challenge where American small businesses are suffering the death of 1,000 paper cuts,” Hensarling said during a full committee markup Tuesday. “The bills that are presented for the CFPB, almost all are practices that are routine for almost every other federal agency.” 

Read the FSR letter. 

Written by Jason Oliva

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