Consumer Financial Protection Bureau: We Won't Hurt Small Business

Knoxville News-Sentinel
August 1, 2011
Maag, Christopher

As part of their ongoing efforts to limit the Consumer Financial Protection Bureau's power, Republicans in Congress are warning that the agency could hurt small businesses. Last week, a congressional subcommittee grilled Dan Sokolov, deputy director of the bureau's research department, on whether the new agency will hurt the ability of small businesses to offer consumers credit and obtain credit themselves. Sokolov said the Dodd-Frank financial reform act specifically limits the new agency to regulating only large banks, as well as the largest companies in non-bank financial sectors like payday lenders and prepaid debit cards. The law specifically bars the CFPB from writing rules concerning small companies like car dealers; and while the bureau's rules will apply to community banks, it is not allowed to bring enforcement actions against them. The bureau is focused "on financial products and services for consumers," Sokolov testified. "The [CFPB] does not have jurisdiction over small business credit except in limited cases where Congress has explicitly and affirmatively granted the Bureau such jurisdiction."
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