Dems Demand Mulvaney Respond to Charges He Has Abandoned Consumer Interests
Senators ask Mulvaney a series of questions, including any efforts by the bureau to restore a working relationship with the Education Department.
Democratic senators are demanding that CFPB Acting Director Mick Mulvaney answer allegations made by the agency’s former student loan ombudsman, who contends that the bureau has abandoned consumers.
Seth Frotman resigned his job at the bureau last month, charging that Mulvaney has placed special interests above consumers in his management of the bureau.
Frotman had been hired by former CFPB Director Richard Cordray, a staunch advocate of strict enforcement by the agency. When Cordray left to run for Ohio governor, President Trump nominated Office of Management and Budget Director Mulvaney as the acting director.
“The resignation letter suggests that under your leadership, supervisory and enforcement activities, marketplace reporting, and interagency cooperation are governed by political expediency rather than strict adherence to the congressionally mandated mission of the CFPB,” 15 Democratic senators, including Senate Banking Committee ranking Democrat Sherrod Brown of Ohio, wrote in their letter.
In their letter, the senators ask Mulvaney a series of questions, including any efforts by the bureau to restore a working relationship with the Education Department, which had cut off the flow of information on student loan servicers between the agencies.
They also ask for evidence that the CFPB has maintained rigorous supervisory oversight of student loan servicers.
In an interview with CNBC last week, Mulvaney said he did know Frotman.
“I’ve never met the gentleman,” he said. “I don’t know who he is.”
Asked about supervision of student loan servicers, Mulvaney said, “The statute says we’re going to be responsible for private student loans and that’s what we’re going to do.”
A CFPB spokesman later tried to clarify Mulvaney’s comments, saying, Mulvaney “was not making a statement about the bureau’s general jurisdiction. He was referencing the statutory limits of the recently vacated Student Loan Ombudsman position. Those limits are clear on the face of the statute and not controversial.”