The current and future chairs of the House Financial Services Committee are pressing federal regulators, including the Consumer Financial Protection Bureau, to halt their rulemaking during the transition to the new administration. Whether the regulators will listen to the requests is a different story altogether.
Driving the news: Committee Chairman Rep. Patrick McHenry [R-N.C.] and incoming Chairman Rep. French Hill [R-Ark.] sent a letter to CFPB Director Rohit Chopra earlier this week, urging the bureau to cease rulemaking activity and secure all documents and communications. Similar directives were issued to the Treasury Department, Federal Reserve, and Securities and Exchange Commisison.
- The letter highlighted the Congressional Review Act, which enables Congress to overturn regulations finalized late in a legislative term. The lawmakers cautioned against “last-minute partisan rulemaking attempts” that could disrupt financial institutions and consumers.
- The CFPB has been particularly active recently, issuing a controversial final rule on overdrafts and new protections for PACE loans under the Truth in Lending Act/Regulation Z. Rumors have also been swirling that a release of its final medical debt credit reporting rule is imminent.
Between the lines: The letter also reflects broader Republican concerns about the CFPB’s independence and activities, including its budget structure and enforcement tactics. These issues have been the focus of recent oversight efforts, with GOP lawmakers asserting their constitutional duty to ensure federal agencies operate within their mandates.
What’s next: The CFPB and other financial regulators were asked to confirm in writing how they plan to preserve all relevant records by December 31. The Republican majority’s scrutiny is likely to intensify once the new Congress convenes, signaling potential changes to the agency’s future rulemaking and enforcement authority.
The bottom line: The CFPB’s actions in the coming weeks could set the stage for significant regulatory and political battles in 2025. Industry stakeholders, including debt collectors, financial institutions, and consumer finance companies, should stay tuned for developments that may impact compliance and operational strategies.
