WASHINGTON, D.C. – The Senate Committee on Appropriations released a Financial Services and General Government Appropriations bill that would make an enormous policy change: it would eliminate the independent funding stream for the Consumer Financial Protection Bureau (CFPB). Congress should pass policy changes in the light of day, not as a toxic rider attached to a budget.
Center for Responsible Lending (CRL) Director of Federal Advocacy Scott Astrada released the following statement:
Financial predators are hoping to hitch a ride on a budget bill. Their rider would severely weaken the CFPB, which has been an effective watchdog for consumers and our economy. The CFPB has established basic borrower protections in housing, prepaid card, and other markets. It has returned $12 billion to nearly 30 million Americans cheated by big banks, payday lenders, and other financial companies.
In the run-up to the financial crisis, regulators were asleep at the wheel, allowing recklessness on Wall Street to cause a Great Recession. In order to avoid repeating this mistake, the CFPB should remain as it was designed: a fully funded, independent agency free from any harmful political influence.
Traditionally, banking regulators, such as the FDIC, OCC, FHFA, NCUA, and the Fed, have independent funding streams to insulate them from the undue political influence of the financial sector. The SEC and CFTC, which are primarily or totally under congressional appropriations, are chronically underfunded in their oversight efforts.
For more information, or to arrange an interview with a CRL spokesperson on this issue, please contact Matthew Kravitz at matthew.kravitz@responsiblelending.org or 202-349-1859.