Jeb Hensarling, the chairman of the House Financial Services Committee, described the Consumer Financial Protection Bureau as a so-called “rogue agency” created to be “insulated” from oversight on the part of the congress, president and voters.
In a piece Hensarling wrote for The Wall Street Journal, he said: “The regulatory web spun by the CFPB can make every provider of financial services guilty until proven innocent, inviting selective enforcement and financial shakedowns.”
According to Hensarling, the CFBP is the “most powerful, least accountable agency in U.S. history,” with agency members having the power to determine the fairness of every financial transaction that goes down in America. What’s more, the lawmaker said the CFPB gets to define its own power and has the freedom to launch investigations “without cause.” Hensarling pointed out that Dodd-Frank excluded auto lenders from the CFPB enforcement, yet the agency hasn’t stopped going after them.
Hensarling said President Trump should fire CFPB Director Richard Cordray immediately. He said Trump has to fire Cordray because of his constitutional responsibility to ensure laws are “faithfully executed.” The lawmaker went on to argue a new director could “first undo all harmful actions taken by the CFPB during the Obama era. He could then implement policies that actually benefit consumers, such as limits on class-action lawsuits wherein plaintiff law firms get fortunes but injured financial consumers get pennies.”
What’s more, Hensarling said a new director could penalize government bond issuers that don’t disclose if there are unfunded pension liabilities and end the government accounting and solvency standards that, if private companies adopted them, he said, would result in fines or the shutting down of the firm. Ultimately, even with a new director, Hensarling said the CFPB is still unconstitutional and that the agency must be “functionally terminated.”
“Consumer protection can instead come through an accountable and constitutional process.”