A Democratic lawmaker slammed opponents of a federal consumer watchdog Tuesday, denouncing them for promoting big business interests while hiding behind a pretense of constitutional concerns.
During a House of Representatives hearing Tuesday over the group's potentially unconstitutional design, Republican lawmakers attacked the Consumer Financial Protection Bureau on multiple fronts. Among other speakers, Rep. Ann Wagner (R-Mo.) blasted the bureau's ability to operate outside of executive and congressional oversight, for instance. (The CFPB is funded by the Fed, which largely insulates the group from political efforts to control it.) “The CFPB has become arrogant in its cloak of unaccountability by pursuing policy and regulating entities outside its authorized scope—to the detriment of consumers,” she said at the hearing.
Meanwhile, expert witness Theodore Olson—a high-profile lawyer who represents a mortgage lender that is fighting a CFPB fine for allegedly accepting kickbacks from mortgage insurers—encouraged Trump to fire the CFPB's single director, Richard Cordray. “The president has the constitutional authority to remove the director,” he told House lawmakers.
But Democrats were quick to dismiss the ongoing blowback—Tuesday's attacks as well as ongoing Republican efforts to rein in the agency—as moves to protect the interests of big money.
While the mortgage lender's ongoing court case has attacked the agency's structure on constitutional grounds, Rep. Keith Ellison (D-Minn.) suggested that Republicans’ fight against the CFPB might be more closely tied to business interests. "This is about protecting a deeply vested, incredibly profitable industry. That’s what’s happening here,” Ellison said. "It’s not about the constitution. That’s a subterfuge."
Ellison urged his audience to remain focused on the protections that the CFPB provides. Originally championed by Massachusetts Sen. Elizabeth Warren, the agency has returned almost $12 billion to more than 27 million American consumers by tackling a number of financial industry abuses—in areas including payday lending, forced arbitration and prepaid accounts.
The CFPB is also responsible for prominent enforcement actions against major financial institutions, such as the recent fine against Wells Fargo for allowing employees to open fake accounts without customers’ knowledge.
“When financial firms rip you off, the CFPB gets your money back. And they need independence to do that,” Ellison said.