The current Congressional session has featured a great deal of bipartisan debate on reforming the Consumer Financial Protection Bureau. Both the House of Representatives and the Senate have introduced legislation that could have a profound impact on the bureau in the future.
In the House last week, a bipartisan group of two Republicans and two Democrats introduced a bill that would address the contentious issue of leadership at the Bureau. The bill, which was introduced by Rep. Dennis Ross (R-Fla.), is called the Financial Product Safety Commission Act of 2018. The text of the bill can be read here. The co-sponsors are Reps. Kyrsten Sinema (D-Ariz.), Ann Wagner (R-Mo.) and David Scott (D-Ga.).
The bill would replace the single director of the CFPB with a bipartisan commission, with no more than three members being from a single political party. Such a structure would align the bureau with other federal agencies such as the Federal Deposit Insurance Corporation, the Federal Reserve Board, and the National Credit Union Administration. 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.”
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. Additionally, 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.
“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 is the best way to make laws and regulations and to serve the American people. The CFPB should not be exempt from this principle of good governance.”
This is actually the third iteration of the same bill, which has now been proposed under two presidential administrations. The bill, which has the support of several financial groups, is currently under consideration in the House Financial Services Committee, where it faces an uncertain future.