The House voted Wednesday to undo the Trump administration’s reining in of the Consumer Financial Protection Bureau (CFPB) and prevent future directors from replicating those efforts.
The bill from Rep. Maxine Waters (D-Calif.), chairwoman of the House Financial Services Committee, passed the chamber along party lines in a vote of 231 to 191, with no Republicans supporting the measure.
Called the Consumers First Act, the bill aims to reverse actions taken by former CFPB Acting Director Mick Mulvaney to loosen the bureau’s oversight of financial firms, rollback agency regulations, reorganize key departments and rebrand the polarizing watchdog.{mosads}
“Putting Mick Mulvaney in charge of the consumer financial protection bureau was the epitome of a fox guarding the hen house, so we have to undo all of the damage he did while he was acting director of the CFPB,” Rep. Carolyn Maloney (D-N.Y.) said in House floor speech ahead of the vote.
Republicans, who have long accused the CFPB of overreaching and being unaccountable, largely favored Mulvaney’s moves to restrain the bureau and came out against Waters’s bill. The White House announced Monday that Trump would veto the bill if it reaches his desk, dooming the measure in the unlikely event it cleared the GOP-controlled Senate.
“I think what we have today is a bit of buyer’s remorse by my Democratic colleagues who created the CFPB in order to be this unaccountable bureau but headed by a Democrat or a Democrat presidential appointee,” said Rep. Patrick McHenry (N.C.), ranking Republican on the Financial Services panel.
The CFPB has been a focus of intense partisan battle since it opened in 2011. Designed by Sen. Elizabeth Warren (D-Mass.), the agency was created through the Dodd-Frank Wall Street reform law to police financial firms for predatory lending and other unfair, abusive or deceptive practices.
Former CFPB Director Richard Cordray (D) led the agency from 2012 through 2017 under the Obama administration, releasing strict regulations and pursuing costly legal cases against firms that allegedly defrauded or abuses their customers.
Cordray’s resignation in November 2017 gave Republicans an opening to weaken the CFPB from within.
Mulvaney, who led the CFPB from November 2017 until this past December when he left to become acting White House chief of staff, was fiercely criticized by Democrats and progressive advocates for his efforts to halt the bureau’s aggressive oversight and regulation of the financial services industry.
As acting bureau head, Mulvaney spearheaded the revision of the CFPB’s rule on payday loans, reduced the frequency of bureau enforcement actions, and sought to give banks and lenders more flexibility to avoid severe fines and public reprimands.
He took heat for stripping enforcement powers from the bureau’s Office of Fair Lending, stacking the agency with political appointees while dismantling expert advisory boards, and taking steps to hide a public database of complaints against lenders and banks.
Mulvaney also changed the bureau’s name to the Bureau of Consumer Financial Protection. That move was reversed in December by his successor, CFPB Director Kathy Kraninger, after The Hill reported that the move would cost the agency between $9 and $19 million and cost entities regulated by the agency roughly $300 million.
Waters’s bill, which begins a lengthy condemnation of Mulvaney’s tenure, would reverse those efforts and bans future CFPB directors from replicating them.
The bill also imposes restrictions on the number of political appointees allowed at the CFPB, requirements for the agency’s advisory boards, and orders the bureau to use “Consumer Financial Protection Bureau” as its formal name.
The bill would also create an Office of Students and Young Consumers focused on student loans, debt repayment and financial product access for young adults and their families.