NEWS: Senator Perdue: CFPB is a 'rogue agency'

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NEWS: February 9

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The CFPB Keeps a Database That Banks Can't Wait to Wipe

A seemingly benign catalogue of consumer complaints is one of banks' biggest gripes. Trump can fix that for them.

Johnson Tyler, a longtime legal aid attorney in Brooklyn, often spends his days battling financial companies on behalf of aggrieved low-income clients. Not much has changed in the wake of the Great Recession, despite new federal rules meant to better protect households from financial misconduct, except in one area: When Tyler complains about a large company, the company actually responds.

"It's the biggest change" Tyler says he has noticed in the consumer finance industry since the 2007-09 financial crisis. The reason is simple: a government-maintained public database that collects consumers' complaints, tracks companies' responses, and records whether consumers ended up satisfied.

The consumer complaint database, created by the federal Consumer Financial Protection Bureau, may be the part of the 2010 Dodd-Frank Act that has had the biggest tangible impact on American households, some consumer advocates say.

Among the changes enacted through Dodd-Frank was the creation of the database, which catalogues consumer complaints about financial products and services. The law called for the CFPB to maintain it and provide Congress with annual updates analyzing the complaints.

Read more at BLOOMBERG

Senator Perdue: CFPB is a 'rogue agency'

David Perdue, the junior Republican Senator from Georgia, appeared at Yahoo Finance's All Markets Summit (AMS) on Thursday and railed against the Consumer Financial Protection Bureau (CFPB).

"The CFPB is a rogue agency that does not have any oversight here in Congress," said Perdue, a former businessman and CEO of Reebok and Dollar General Stores (DG), who was interviewed remotely at AMS.

The CFPB - created as part of the 2010 financial regulatory overhaul known as Dodd-Frank - enforces protections for consumers primarily in the areas of student loans, mortgages and credit cards. The agency has also taken aim at for-profit colleges.

Perdue and other Republicans have attacked the CFPB for supposedly being too powerful and argue that its single director has too much unchecked sovereignty. Since Trump's election, Republicans have moved to chip away at that authority.

Last week, Perdue was one of several lawmakers to introduce a bill to stop the agency from implementing a rule that provides protections for consumers of pre-paid accounts. The lawmakers said the rule would "stifle growth" in the electronic payment marketplace.

"If the CFPB wants to continue to impose rules and regulations that impact every American's financial well-being, it must answer to the American people," Perdue said in a statement after the bill was introduced.

The CFPB is not the only part of Dodd-Frank that Perdue would like to do away with. When speaking to Yahoo Finance on Wednesday, Perdue said he'd like to get rid of minimum capital reserve requirements for smaller, regional banks, which he argued stem the flow of money to small businesses. Referring to the entirety of Dodd-Frank, Perdue said, "This thing has got to get fixed and fixed now." Read the story at YAHOO FINANCE

Wendy Davis vs. Greg Abbott: Looking for pay dirt on payday lending

The first week of 2014 has offered a very nice preview of the mano-a-mano combat between the respective gubernatorial campaigns of Sen. Wendy Davis, D-Fort Worth, and Attorney General Greg Abbott that will likely come to characterize the marquee rivalry of the political year in Texas - even before they get past the March primary, in which each faces his or her own opponents. The issue that has dominated their back-and-forth since Davis first raised it just before the New Year, is payday lending, and the way the issue has played out has laid bare some obvious kinks in Davis' operation - which is going to have to prove pretty kink-free, and her armor chink-free, if it has any hopes of prevailing - but also some lurking peril for Abbott, who I suspect cannot long hide behind the statutory limits of his current job to avoid describing how he would fulfill his responsibilities in what he hopes will be his next job.

Abbott's circumspection on the issue is probably well warranted, because, even in Texas, payday lending is one enterprise in which it would appear the general public - and even some quite conservative folks - approve of greater government regulation.

When the social and economic justice advocacy group, Texas Appleseed, commissioned a voter survey in 2012, it found that:

The official who oversees Texas' consumer watchdog says payday-loan customers - not the lenders - are responsible when the loans trap them in a cycle of debt.

William J. White says it's out of line to even question an industry that has had its practices called exploitative by many critics, including the Catholic Church.

White was appointed by Gov. Rick Perry to chair the state agency that oversees the Office of the Consumer Credit Commissioner, which is responsible for protecting consumers from predatory lending practices.

White also is vice president of Cash America, a major payday lender that the new U.S. Consumer Financial Protection Bureau last month socked with its first sanctions for abusive practices.

Read the entire article at STATESMAN

Trump's allies building case to oust consumer protection head

Allies of President Donald Trump are building a legal case for ousting Richard Cordray, the director of the Consumer Finance Protection Bureau who one court called "the single most powerful official" in government after the president.

Cordray has long been in the cross hairs of free-market conservatives and lawyers, and now some are informally compiling a dossier that would give Trump cover to fire him, should he choose to do so, for "inefficiency, neglect of duty, or malfeasance." Those are the only conditions under which the director can be removed.

Cordray's supporters are itching for that fight. Firing him would ignite a political fuse that could cause more damage than it's worth to his foes. Even some Trump advisers are ambivalent about the idea, saying it might be easier to live with Cordray until his term expires in July 2018.

"There has been talk of getting rid of Cordray, but I think they're trying to figure out what they can do and what [Trump] will actually go along with," said a person close to the administration.

Lawyers who say they're providing guidance to the White House declined to comment for the record or be identified, citing confidences with people connected to the administration. They say they're responding to questions from those people but won't say who they are.