Five-year plan continues Mulvaney restraint

The Consumer Financial Protection Bureau will continue its more low-key, hands-off approach to consumer protection and regulation, one which equally emphasizes the rights of the regulated.

The Consumer Financial Protection Bureau will continue its more low-key, hands-off approach to consumer protection and regulation, one which equally emphasizes the rights of the regulated.

That’s according to the agency’s latest five-year strategic plan, released by Acting Director Mick Mulvaney earlier this week.

The 14-page document outlines the bureau’s priorities for the next half-decade, most of which include going no further than the goals outlined in the 2010 Dodd-Frank Act: “to regulate the offering and provision of consumer financial products or services under the Federal consumer financial laws” and “to educate and empower consumers to make better informed financial decisions.”

The CFPB needed “a more coherent strategic direction,” which Mulvaney identified as a resolve to “fulfill the bureau’s statutory responsibilities, but go no further.”

The plan is less than half the length of prior director Richard Cordray’s draft plan released in October, although that is largely because discussion of the bureau’s performance goals and measures would be moved to the annual performance plan and report instead.

Among other changes from Cordray’s version, the bureau said it would “now focus on equally protecting the legal rights of all, including those regulated by the bureau,” engaging in “rulemaking where appropriate to address unwarranted regulatory burdens and to implement federal consumer financial law and will operate more efficiently, effectively, and transparently.”

Both drafts begin with a list of the five objectives outlined in the Dodd-Frank Act, but begin to diverge in their mission statements. Mulvaney’s version proclaims that the bureau will “regulate the offering and provision of consumer financial products or services under the Federal consumer financial laws” and “educate and empower consumers to make better informed financial decisions.” Corday’s bureau said it would help “consumer financial markets work by making rules more effective, by consistently and fairly enforcing those rules, and by empowering consumers to take more control over their economic lives.”

The disparate visions of the two directors place the emphasis on different targets as well. Cordray’s centered the American consumer, promising transparency and fairness in financial markets, and mentioning “responsible providers, and the economy as a whole” only at the end. Mulvaney’s envisions “free, innovative, competitive, and transparent consumer finance markets where the rights of all parties are protected by the rule of law,” in which consumers are free to make their own choices.

Finally, Mulvaney’s three goals promise equal access, fairness, transparency and operational excellence:

  1. Ensure that all consumers have access to markets for consumer financial products and services.
  2. Implement and enforce the law consistently to ensure that markets for consumer financial products and services are fair, transparent, and competitive.
  3. Foster operational excellence through efficient and effective processes, governance, and security of resources and information.

Cordray’s four goals were similarly structured, but emphasized a more aggressive, proactive pursuit of consumer protection:

  1. Prevent financial harm to consumers while promoting good practices that work for consumers, responsible providers, and the economy as a whole.
  2. Empower consumers to make informed financial choices to reach their own life goals and enhance their own financial well-being.
  3. Inform the public, policy-makers, and the CFPB’s own policy-making with market intelligence and data-driven analysis of consumer financial markets and consumer behavior.
  4. Advance the CFPB’s performance by maximizing resource productivity.

Mulvaney characterized the scaled-back approach enunciated in the plan as in-line with directives about federal regulatory behavior.

“Indeed, this should be an ironclad promise for any federal agency; pushing the envelope in pursuit of other objectives ignores the will of the American people, as established in law by their representatives in Congress and the White House,” Mulvaney said. “Pushing the envelope also risks trampling upon the liberties of our citizens, or interfering with the sovereignty or autonomy of the states or Indian tribes. I have resolved that this will not happen at the bureau.”