Oct. 19, 2016
CFPB Still an Independent Agency, Should Not Submit to OIRA Review
Statement of Amit Narang, Regulatory Policy Advocate for Public Citizen’s Congress Watch Division
Note: Today, the chairman of the U.S. House of Representatives Financial Services Committee, U.S. Rep. Jeb Hensarling (R-Texas), sent a letter to Richard Cordray, director of the U.S. Consumer Financial Protection Bureau (CFPB), arguing that the agency must now submit proposed regulations to the U.S. Office of Information and Regulatory Affairs (OIRA) for review. Last week, the U.S. Court of Appeals for the District of Columbia Circuit ruled that the president must be allowed to remove the CFPB’s director at will.
The CFPB should reject Chairman Hensarling’s demand that the CFPB submit its rulemakings to OIRA for regulatory review. The CFPB’s time to petition for review of the D.C. Circuit’s ruling has not yet expired, and accordingly it makes little sense for OIRA to review CFPB rules when the court decision is not final and could be reversed. Even if the decision were upheld, current law specifically identifies the CFPB as an independent agency that is excluded from the executive order requiring OIRA review. That law was not altered by the court’s opinion.
The CFPB has been one of the toughest and most effective agencies when it comes to holding accountable financial firms that manipulate, deceive and abuse consumers. The CFPB has returned more than $11 billion in fines to consumers through its enforcement actions. In the wake of the Wells Fargo scandal, any reforms to weaken the CFPB’s independence are attempts to put Wall Street banks ahead of Main Street consumers and small businesses.