Credit Union Regulatory Relief in Jeopardy as Talks Break Down
The talks between Senate Banking Chairman Mike Crapo (R-Id.) and his ranking Democrat, Sherrod Brown of Ohio on a bipartisan financial regulatory overhaul have broken down without a deal being struck, Brown confirmed Wednesday.
“After working in good faith, it’s clear we will not be able to reach a compromise that protects consumers while supporting small banks and credit unions,” Brown said, in a statement. “I continue to support small banks and credit unions, but I cannot agree to gutting protections for working people and taxpayers.”
The two had sought to reach agreement on changes to the Dodd-Frank Act that would be able to gain 60 votes needed to pass legislation in the Senate. The exact issues that led to the stalemate weren’t clear Wednesday
Neither senator addressed the issue during a committee hearing Wednesday morning.
The House already has passed House Banking Chairman Jeb Hensarling’s (R-Texas) Financial CHOICE Act. That bill would make huge changes to the CFPB, including a plan to eliminate its supervisory powers.
That bill passed the House without any Democratic support.
Senators have made it clear they would not take up the Hensarling bill since it would not pass the Senate. In that chamber, 60 votes are needed to pass legislation in order to avoid the threat of a filibuster.
The CFPB has widespread support among Senate Democrats, while many Republicans, including President Trump, have said they would like to see its powers curtailed.
Democratic support became even more apparent last week, when a resolution nullifying the CFPB’s arbitration rule garnered no Democratic support.
Some Democrats have been pressing Crapo and Brown to work on a regulatory overhaul bill.
Four Democratic members of the Banking Committees—Sens. Mark Warner of Virginia, Heidi Heitkamp of North Dakota, Joe Donnelly of Indiana and Jon Tester of Montana—wrote a letter last month to the leaders of the Banking panel pledging support for a bipartisan effort.
“Please know that we support your efforts and strongly encourage you to reach an agreement on a regulatory reform package that can come before the committee for consideration in the coming weeks,” the senators wrote.
One source familiar with the negotiations lamented the failure.
“There may still be a deal on a Senate regulatory relief within reach, but it’s going to entail the Republicans working with the four Democratic moderates on the Banking Committee,” the source said. “It would be a real shame if something as important as regulatory relief for credit unions and other smaller institutions is abandoned with 14 months left in this Congress.”