Republicans Attacking CFPB on Multiple Fronts


in Congress are pulling out all the stops to make sure that Richard Cordray is not  confirmed to continue as Director of the
Consumer Finance Protection Bureau (CFPB) and, indeed, that the Bureau is not
allow to exist in its present form.

currently serves as director through an interim presidential appointment in
January 2012 after Republican senators made it clear they would not confirm
Cordray or anyone else to the position. 
They admitted they had no objections to the qualifications of Cordray or
of Elizabeth Warren, the President’s supposed first pick for the position, but
to the existence of the Bureau itself. 
Cordray’s interim appointment is expiring and President Obama has
nominated him for a regular appointment.

Jeb Hensarling (R-TX), Chairman of the House Financial Services Committee sent
a letter
to Federal Reserve Board Chairman Ben Bernanke regarding the
legality of a recent infusion of funds to the Bureau.  The Dodd-Frank Wall Street Reform and
Consumer Protection Act set up the CFPB to receive its monies directly from the
Federal Reserve to insure its independence from Congress. The letter is based
on questions about the validity of Cordray’s original appointment because of a
recent Appeals Court decision which invalidated the appointments of three
members of the National Labor Relations Board made on the same day, also to
circumvent the senate’s refusal to confirm any nominees for the positions.

asks the Board of Governors of the Federal Reserve to clarify the transfer of
to the CFPB following that court decision on the basis that he
anticipates “a federal court will soon reach a similar conclusion with respect
to the validity of Mr. Cordray’s appointment.”

The representative states
that Dodd-Frank “authorizes the Board to transfer funds to carry out the
authorities of the CFPB only at the request of its director.  Because it appears there is not presently a
validly appointed director of the CFPB, I question the circumstances under
which the Board may lawfully fund the CFPB’s operations.”

Meanwhile, over in the Senate confirmation hearings on Cordray
were scheduled today before the Senate Banking Committee despite a pledge by 43
Republican senators to block his confirmation unless structural changes are
made to the Bureau including placing it under the control of a bipartisan
commission and submitting its budget to the congressional appropriations
process.    Forty-three votes are enough
to block closure and prevent an up or down vote on the nomination.

In his written testimony
prepared for his confirmation hearing Cordray said his approach to the role of
Director is deeply informed by more than two decades in public service.  In his career as a county tax collector, Ohio State
Treasurer and Attorney General he said he found “that law enforcement
which is evenhanded, fair, and
reasonable not only protects consumers,
but also supports what I call
the honest businesses in two key ways.  First,
the businesses that cheat can gain
a significant and unfair advantage, and law
enforcement protects
businesses against the cheaters.
 Second, keeping the
marketplace clean ensures consumers are treated
fairly and gives them confidence they need to participate in
that market.”

Cordray outlined what the Bureau has done in its two years of operation
in the areas of mortgages, student loans, credit cards, consumer education, and
responding to consumer complaints but said there is much more to be done in
each of those areas. “Our essential work is to serve and protect consumers –
our mothers and fathers,
sisters and brothers,
sons and daughters – all the people
of this country who rely every
on the markets for consumer
finance. They deserve a fair
shake, and
they deserve to
have this agency standing on their
side to make sure they are treated

“As the economy recovers, we want people to know they now have a new agency standing on their
side, looking out for
their interests,
to help restore their confidence in the consumer
financial marketplace,” Cordray said. 

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