by Deepak Gupta
The House Financial Services Committee is holding a hearing at 10am tomorrow, April 6, on "Legislative Proposals to Improve [Read: Weaken] the Structure of the CFPB." The Committee will consider four GOP proposals to weaken the Consumer Financial Protection Bureau's effectiveness in both the short and long term -- even before the agency is officially launched. Each of the four proposals seeks to relitigate issues that were resolved with the enactment of the Dodd-Frank Act last year:
H.R. 1121: "The Responsible Consumer Financial Protection Regulations Act of 2011." This bill, introduced by Chairman Spencer Bachus, would replace the Director of the CFPB with a five-member Commission.
H.R. 1315: "The Consumer Financial Protection Safety and Soundness Act." This bill, introduced by Rep. Duffy, would beef up the Financial Stability Oversight Council's already unprecedented power to veto regulations issued by the CFPB. It would change the vote required for the FSOC to set aside CFPB regulations from two-thirds to a simple majority. It would make clear that the FSOC must set aside any regulation that puts the safety and soundness of the banking system at risk. And it would eliminate the time limits established for the FSOC's decision about whether to veto a regulation.
H.R. __ and H.R. ___: Legislation Affecting CFPB's Authorites Prior to the Appointment of a Director. These bills, introduced by Rep. Capito, would (1) remove the prudential regulators' ability to allow the CFPB to participate in examinations of large financial institutions before the designated transfer date and (2) make the date for transferring regulatory authority dependent on whether the CFPB's Director has been confirmed by the Senate.
Tomorrow's hearing will include testimony from representatives of five financial services trade groups -- the American Bankers Association, the Consumer Bankers Association, the Credit Union National Association, the Independent Community Bankers of America and the National Association of Federal Credit Unions - along with input from Jess Sharp, executive director of the U.S. Chamber of Commerce's Center for Capital Markets Competitiveness. As far as I can tell, nobody from the CFPB is slated to appear.
For more, see this article in The Hill. You can watch a live webcast of the hearing here.