Dodd-Frank Replacement Bill would Transform CFPB
With the passage of the Dodd-Frank Act in 2010, one of the most unaccountable federal agencies in American history was created. Title X of Dodd-Frank consolidated authority for over 50 rules and orders stemming from 18 different consumer protection laws spread among seven agencies into the hands of the newly created Consumer Financial Protection Bureau (CFPB).
Purposely designed to be independent, the CFPB receives its funding outside of Congressional approval and has one single director, appointed by the President for a 5 year term, who can create new rules and regulations on various financial companies including banks, lending institutions, and mortgage-servicing organizations, among many others, and can then take them to court if they don’t comply.
The rules and regulations issued by the CFPB are so burdensome and confusing that new organizations, such as the Mortgage Compliance Professionals Association of America (MCPAOA), are popping up in order to provide businesses with “regulatory compliance experts.”
Thankfully, legislative momentum is building to fight back. Representative Jeb Hensarling (R-TX) recently introduced “The Financial CHOICE Act,” which would rename the CFPB to the “Consumer Financial Opportunity Commission” and restructure the bureau by replacing the director with a bipartisan, five member commission, subject to congressional oversight and the appropriations process. Short of full repeal, this is the least Congress should to do rein in this out-of-control federal agency and truly protect consumers.