Another bill has been introduced in the Senate that would require the Consumer Financial Protection Bureau’s budget to be approved by Congress as a means of instituting checks and balances against what the sponsor of the bills calls a “radical nominee” who is set to take over running the agency.
S.2790, The Consumer Financial Protection Bureau Accountability Act of 2021 was introduced by Sen. Bill Hagerty [R-Tenn.] and has already accumulated 16 co-sponsors, each of them a Republican.
Currently, the CFPB’s budget comes from the Federal Reserve, and is not subject to Congressional approval, unlike many other federal agencies. Republicans have tried on a number of occasions to change that, and make the CFPB come to Congress to get its funding every year. Back in 2018, for example, the House Appropriations Committee approved a bill that would subject the CFPB to the Congressional appropriations process, but the bill never made it to the House floor for a vote.
This time, Republicans appear to be more motivated because the CFPB is poised to be taken over by Rohit Chopra, who is set to be confirmed as the agency’s next permanent Director.
“Should Democrats choose to confirm President Biden’s radical nominee, who has dodged questions throughout the confirmation process and is likely to continue the anti-job-creation, unaccountable CFPB conduct of the Obama administration, the CFPB must be required to go through the regular congressional appropriations process to ensure public accountability,” said Sen. Hagerty, in a statement. “As a lifelong businessman, protecting consumers in the financial marketplace is important, but handing vast government regulatory power to an agency that is not accountable to the American people’s elected representatives is improper. Americans deserve to have far greater input in this agency.”
Calling the current budget arrangement “highly unusual,” Sen. Hagerty wants the CFPB to ask Congress each year for the money it needs to operate, which would give Congress more control over the regulator. The funding mechanism for the CFPB was intended to ensure independence, not unlike the leadership structure, which, until recently, allowed the director of the agency to only be fired for cause. The Supreme Court found that to be unconstitutional and gave the president the power to fire the director for any reason.
