An assortment of financial industry trade groups have thrown their support behind H.R. 4773, the Consumer Financial Protection Commission Act, which would alter the leadership structure of the Consumer Financial Protection Bureau. The bill, introduced by Rep. Blaine Luetkemeyer (R-Mo.), would create a bipartisan five-person commission to head the agency instead of its current, single director.
“A Senate confirmed, bipartisan commission will provide a balanced and deliberative approach to supervision, regulation, and enforcement by encouraging input from all stakeholders,” the groups wrote in a letter. “The current single director structure leads to uncertainty as administrations transition. This uncertainty is not only borne by financial institutions providing significant lending services, but it negatively impacts America’s consumers, small businesses, and our local economies.”
Versions of the bill have been introduced in previous legislative sessions, including one from Rep. Luetkemeyer last year. The bipartisan commission structure has been favored by industry advocates and CFPB critics who feel that the bureau depends too much on the individual priorities of a singular director, leading to whiplash changes as administrations shift.
“The bureau is constantly being used as a political football due to the almost limitless power of its director. Allowing one person to wield such unchecked authority over our economy is irresponsible and verges on negligence,” Luetkemeyer said when he introduced the bill. Luetkemeyer also criticized CFPB Acting Director Dave Uejio for making “major, partisan policy decisions as he sees fit.”
Uejio has led the CFPB since former director Kathleen Kraninger’s resignation at President Biden’s request in January. In that time, he has prioritized Covid-19 relief for consumers and racial justice issues.
“Dramatic shifts in the CFPB’s philosophy and approach with each change in presidential administration make it difficult for lenders and small businesses to plan for the future,” the groups said. “It is the traditional structure for a financial services regulator as this leadership model provides some moderation and stability regardless of who is in the White House.”
The letter was signed by almost 30 groups, including ACA International, the American Bankers Association, Consumer Bankers Association, Credit Union National Association, Independent Community Bankers of America, Mortgage Bankers Association, National Association of Federally-Insured Credit Unions, National Association of Realtors and the U.S. Chamber of Commerce.
Last year, the Supreme Court ruled the CFPB’s original leadership structure, in which the director could only be removed by the President for cause, was unconstitutional. The director may now be removed at will.