Credit union trade groups once again are pushing a bill that would convert the Consumer Financial Protection Bureau into a five-member commission—a measure that has slim chances of being enacted in a Democratic-controlled Congress.
The National Association of Federally-Insured Credit Unions and the Credit Union National Association joined banking trade groups and a group representing the payday lending industry in endorsing H.R. 4773, which was introduced by Rep. Blaine Luetkemeyer, R-Mo., the ranking Republican on the House Financial Services Committee’s Consumer Protection and Financial Institutions Subcommittee.
The legislation has long been a Republican talking point. However, House Financial Services Chairwoman Rep. Maxine Waters, D-Calif., and Senate Banking Chairman Sen. Sherrod Brown, D-Ohio, are staunch supporters of the CFPB, so the bill is extremely unlikely to be considered by either committee.
That has not dissuaded trade groups from supporting the bill. “A Senate confirmed, bipartisan commission will provide a balanced and deliberative approach to supervision, regulation, and enforcement by encouraging input from all stakeholders,” the groups wrote in a letter to Luetkemeyer.
They said that the single-director structure leads to uncertainty as administrations transition. They wrote, “Dramatic shifts in the CFPB’s philosophy and approach with each change in presidential administration make it difficult for lenders and small businesses to plan for the future.”
As written in the Dodd-Frank Act, the director of the agency was supposed to be able to be removed only for cause. However, the U.S. Supreme Court ruled that structure unconstitutional.
The ruling meant that upon taking office, President Biden was able to replace CFPB Director Kathleen Kraninger, a Trump Administration appointee who was considered friendly to businesses regulated by the agency. Biden nominated Federal Trade Commission Commissioner Rohit Chopra for the job. Chopra has not yet been confirmed by the Senate, so Biden selected Dave Uejio as acting director. Both men are advocates of a strict regulatory regime.