House Votes to Overhaul Consumer Agency
July 21, 2011
Mui, Ylan Q.
The U.S. House approved legislation in a vote of 241-to-173 that would
strengthen the veto power of the Financial Stability Oversight Council over the
Consumer Financial Protection Bureau's (CFPB) decisions, install a five-member
commission to replace the single director as the head of the bureau, and delay
the transfer of powers from other federal agencies. The measure also calls for
the bureau to be subject to congressional appropriations. However, the
legislation is unlikely to pass the U.S. Senate. The CFPB opened for business on
July 21 without a director, though the Obama Administration has nominated former
Ohio Attorney General Richard Cordray. Senate Republicans have said they will
continue to block any nominee until the agency's structure is modified. Without
a director, CFPB cannot write many new rules and it lacks the authority to
oversee payday lenders and check cashers. The agency is expected to consolidate
the consumer protection powers of seven government agencies and to focus on
transparency, disclosures, and protection against unfair, deceptive, or abusive
practices. CFPB is currently accepting complaints from consumers about credit
cards, and the agency is prepared to begin work, says White House Advisor
Elizabeth Warren. Moreover, a recent study reveals that 63 percent of voters
favor greater oversight of financial firms and nearly 75 percent of respondents
favor a single agency tasked with consumer protection.
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