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Trump has a reason to keep Cordray at CFPB - to stop him from being Ohio governor

Congressional Republicans want Cordray fired but that may lead to his run, and possibly win, for Ohio governor as a Democrat

Despite several calls by House Republicans for President Donald Trump to fire Consumer Financial Protection Bureau Director Richard Cordray, the president could decide to keep his friends close and his enemies closer.

White House spokesman's Sean Spicer's last comment on whether Trump would remove Cordray, was, "We'll see where we go."

Richard Cordray, a Democrat and former Ohio Attorney general, would be a top contender in the upcoming race for Ohio governor, should he choose to return to his home state. The field is still full of potential candidates from both parties, as Gov. John Kasich is barred from reelection in 2018 by term limits.

Ohio Democrats might like Cordray's chances to retake the governor's mansion for the party, but state GOP candidates may hope he stays on the job at the CFPB given his strong base as a former state attorney general and ability to draw big names to Ohio to raise money for a campaign if needed.

Cleveland.com reported in November that Sen. Elizabeth Warren appeared at a fundraising event in the summer in Columbus and spent time "talking about what a great person Rich Cordray was," according to Ohio State Rep. David Leland. Read the story at MARKETWATCH

Draining The CFPB's Swamp

In a swamp full of critters, there is none more creepy and crawly than the Consumer Financial Protection Bureau.

According to the CFPB's 2016 financial report, the agency presides over an operating budget of roughly $650m ($1.2b in total resources) - a 15% increase from 2015. In 2016, $290m was spent on personnel compensation and benefits (including to former employees). An additional $18m was spent on travel and transportation of people - more than $11,107 per employee in one year.

In other words, nearly half of the CFPB's operating budget is used for personnel compensation and associated costs.

In 2010, the CFPB had 58 employees. In 2016, the number was 1,648 employees - a 2,741% increase in less than a decade!

This bureaucratic behemoth embodies the regulatory regime that has come to define the Obama administration. Created by the 2010 Dodd-Frank reforms, the CFPB reserves the right to issue and enforce a wide array of financial regulations to "make consumer financial markets work for consumers, responsible providers, and the economy as a whole."

The CFPB's mission statement is now a sweeping justification to target financial services such as mortgages, credit cards, loan servicing, check guaranteeing, and payday loans.

In 2014 alone, the total financial impact of regulations and lost revenue to credit unions surpassed $7 billion.

Payday lenders - who provide short-term loans to low-income families - feel the heat in particular. Look no further than Sen. Elizabeth Warren, D-Mass. - the CFPB's creator - who claims that "payday loans are an enormous problem for families and communities across our country."

Read the story at INVESTORS BUSINESS DAILY

Republicans to predatory companies: Grab as much as you can

The White House may be in chaos. But at least Congress is addressing the issue Americans care about most: making it easier for the finance industry to rip them off.

Last week, Jeb Hensarling (R-Tex.), chairman of the House Financial Services Committee, circulated an outline of his latest plan to repeal Dodd-Frank. Dodd-Frank, you may recall, was put in place after the financial crisis to reduce our chances of having another one.

The law isn't perfect, but it did have at least one critical, mostly popular component: It created an agency dedicated solely to helping consumers fight back when financial institutions cheat or mislead them.

This agency is called the Consumer Financial Protection Bureau (CFPB). It oversees large banks, thrifts and credit unions, along with lots of companies in the "nonbank" universe, such as mortgage brokers and servicers, payday lenders, debt collectors, private student lenders and credit bureaus.

While the CFPB may not have the same name recognition as, say, the Federal Reserve, many of its actions have generated big headlines.

Remember when Wells Fargo got caught creating millions of fake customer accounts? 

The bureau has also, among other things, sued pension-advance companies that fleece veterans, and it ordered the firms that left low-income users of prepaid RushCards unable to access their own money to pay $13 m in restitution and fines.    Read the story at The WASHINGTON POST

Despite critics' claims, Dodd-Frank hasn't slowed lending to business or consumers

There may be good reasons to overhaul parts of the sweeping Dodd-Frank financial reforms, enacted in 2010 in response to the financial crisis two years earlier.

But concern about a slowdown in bank lending isn't one of them.

President Donald Trump and congressional Republicans have vowed to roll back a wide range of federal regulations - with Dodd-Frank one their top priority targets.

On Friday, Trump ordered the Treasury Department and other financial regulators to review the banking and consumer finance rules created under Dodd-Frank, a law he has called "a disaster."

"We expect to be cutting a lot out of Dodd-Frank," he told a group of bankers and other corporate executives, "because, frankly, I have so many people, friends of mine that have nice businesses that can't borrow money. They just can't get any money because the banks just won't let them borrow because of the rules and regulations in Dodd-Frank."

Trump's order did not specify which regulations he would like to see lifted, a move that will require congressional legislation. But defenders of the law have noted that the Trump administration could choose to relax enforcement of portions of the law it deems too restrictive.

Opponents of the law argue, among other criticisms, that it has clamped down too hard on banks and restricted the availability of credit for businesses and consumers. Read the article at CNBC

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