Republicans Push Cordray on Transparency and Legitimacy
House Republicans on Tuesday pushed Consumer Financial Protection Bureau Director Richard Cordray to be more transparent about the CFPB’s regulatory plans and questioned whether questions surrounding how he was appointed would impact the new agency’s legitimacy.
Rep. Patrick McHenry, who chairs the House Oversight Subcommittee on TARP, Financial Services and Bailouts of Public and Private Programs, urged Cordray to publish the bureau’s regulatory agenda on a monthly or yearly basis so financial institutions could know what to expect.
Cordray declined to commit but said the bureau’s goal is to be as transparent as possible and said he’d work with lawmakers to see if he could accommodate some of their concerns.
He also reiterated his pledge to set up advisory committees of credit unions and community banks to help the agency understand the impact of its regulations on those institutions.
McHenry (R-N.C.) asked Cordray what are the top items on the bureau’s regulatory agenda.
Cordray said the agency’s congressional mandate includes combining the disclosure forms of the Truth in Lending and Act and Real Estate Settlement Procedures Act. Draft forms already have been circulated.
Rep. Darrell Issa (R-Calif.), who chairs the full committee, asked Cordray whether he has taken steps to ensure that the agency’s efforts won’t be in vain if there is successful litigation challenging the constitutionality of President Obama’s recess appointment of him.
Cordray said “I will give it some thought,’’ but wasn’t going to refrain from taking actions out of fear of an unfavorable legal decision.
Rep. Frank Guinta (R-N.H.) asked whether the questions surrounding his appointment might cause some financial institutions to question the legitimacy of the agency’s actions.
Cordray said now that he is in the job all that he can do is to carry out his responsibilities in a way that is transparent and accountable.
He declined to say whether he agreed with the comment of Elizabeth Warren, who conceived of and set up the CFPB, that it was the most constrained and accountable federal agency.
However, he noted that that the bureau is the only agency that can have its decisions overturned by another entity and it is the only independent financial regulator that has to go to Congress if it wants to increase its budget.
Several Democrats said the presence of Cordray at the CFPB will enable it to regulate nonbank entities and level the playing field for banks and credit unions.
Rep. Mike Quigley, the top Democrat on the subcommittee, said that “leveling the playing field, especially for community banks,’’ should be a top priority.
Cordray told Quigley (D-Ill.) that regulating nonbank entities was the first thing he did when taking office and that a more level playing field “would have helped community banks and credit unions in the ruin up to the financial crisis.’’
Rep. Peter Welch (D-Vt.) praised the CFPB’s commitment to streamlining regulations.
He asked if Cordray agreed with his belief that “simple and clear beats complex and confusing.’’ Cordray said he did.