Key Senate Republican Blasts CFPB Management, Nominee
Chopra does not address whether the CFPB should be governed by a single director or commission, as credit union groups want.
Foreshadowing what the next four years are likely to look like, a key Senate Republican attacked the Biden Administration’s management of the CFPB during its first month in office.
“As detailed in a series of recent statements, the Bureau appears to believe that it can ignore jurisdictional limits and regulate without congressional authorization, that the economy can easily bear additional regulatory pressures, and that consumers can tolerate the resulting costs,” Senate Banking Committee ranking Republican Sen. Pat Toomey of Pennsylvania wrote in a letter Monday to agency Acting Director Dave Uejio.
Toomey expressed similar sentiments during a confirmation hearing Tuesday for Rohit Chopra, President Biden’s choice to permanently head the agency. He said he is concerned that the agency is returning to an era of regulation through enforcement.
Toomey said that Chopra, a current member of the Federal Trade Commission and former CFPB official, “was known to have a hostile relationship with many lenders.”
However, Senate Banking Chairman Sherrod Brown (D-Ohio) noted that Chopra was unanimously confirmed by the Senate to serve on the FTC.
“He has a deep understanding of financial markets and a strong record of protecting consumers and small businesses, promoting competitive markets and holding bad actors accountable,” Brown said.
During the hearing, Chopra defended CFPB actions to enforce the Military Lending Act, which the Trump Administration said the agency did not have the power to do. And he said that the CFPB must examine the financial services offered to college students, including debit and credit cards. “Congress has made it clear that it is concerned about the financial services offered to college students,” he said.
Sen. Elizabeth Warren (D-Mass.) said that the Trump Administration gutted the agency’s fair lending office and asked Chopra if he planned to reinvigorate the office.
Chopra said that Congress gave the agency power to enforce fair lending laws.
“I don’t believe that agencies should nullify Congress,” he added.
He also reaffirmed that no agency should sanction supervised businesses based on guidance. “Guidance cannot impose obligations,” he said.
Chopra would not address the issue of whether the CFPB should be governed by a single director or by a commission, as has been advocated by credit union trade groups. “It is the job of Congress to establish our agency’s structure,” he said.
The Banking Committee confirmation hearing featured Chopra and Gary Gensler, Biden’s choice to head the Securities and Exchange Commission. Much of the questioning centered on the SEC and investor protections, rather than issues facing the consumer bureau.