Since its creation, the Consumer Financial Protection Bureau (CFPB) has
been a source of controversy. Its proponents claim it is the only thing
standing between the average American consumer and out-of-control financial
institution greed. Its opponents – often those same accused banks,
Wall Street leaders, and legislators that side with them – see it
as a gross abuse of regulatory power over the natural workings of the
American economy. Through the efforts of the CFPB alone, more than $12
billion has been returned to consumers, paid out by banks that were found in violation
of its regulations.
Most recently, the CFPB hit the headlines after its director, Richard Cordray,
resigned. Before leaving, he named a new deputy director, Leandra English,
the preexisting chief of staff at the CFPB. The agency’s own rules
would automatically assign English as the new director as soon as Cordray
stepped out. However, Trump has put his hat into the ring by unexpectedly
naming Mick Mulvaney, the Office of Management and Budget director, as
the new director of the CFPB as well.
Who Would Win: Banks or Consumers?
There is currently a power-play toss-up between who will end up sitting
on the CFPB director’s chair. Both English and Mulvaney have exercised
power as if they are the acting director, and indeed they both are. Will
one back down before the other, or ever at all?
However, the conflict is nothing new to the CFPB. Elizabeth Warren, the
brain behind the agency, was assumed to be a pencil-in director once it
was established back in 2011, but Republicans fought tooth-and-nail to
keep her out. It even took two years to get Cordray officially named as
its director due to Congressional infighting and lobbyist interests.
Yes, the conflict between the Consumer Financial Protection Bureau and
big banks has been around since day one of its inception. It is no surprise,
though. The agency puts a spotlight on the dirty laundry of financial
institutions and does not pull punches when it comes to enforcing regulatory
penalties. Just recently, the agency made Wells Fargo drop $190 million
in fines, fees, and refunds after it was found the bank was intentionally
creating fake user accounts to pad its records.
The middle ground between both sides of the argument is difficult to see.
Many Republicans want the CFPB to be funded by Congress and the President
to be given the power to fire its director. On the other hand, many Democrats
want Mulvaney replaced by another potential nominee since he actively
tried to dismantle the CFPB while still a Congress member. It is not clear
if the line between the opposing parties will ever be moved.
(You can learn more about this ongoing story by
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Christian & Davis LLC has an invested interested in any sort of agency
or legislation that can protect the American people from the questionable
actions of conglomerates, lobbyists, and “shady” banks and
lenders. We believe in preserving people’s rights to seek justice
and compensation whenever wronged. If you have been hurt by another party
and need help filing a claim, call
our South Carolina injury attorneys online to begin.