WASHINGTON (6/12/15)--CUNA and its partners in a coalition of financial and housing trade associations Thursday submitted a joint statement for the record supporting transitioning the governing structure of the Consumer Financial Protection Bureau (CFPB) to a five-member, bipartisan commission.
The statement was delivered Thursday to the House Financial Services Committee’s subcommittee on financial institutions and consumer credit that began hearings on 12 regulatory relief bills, including six supported by credit unions. CUNA staff monitored the hearings’ progress.
H.R. 1266 would replace the current CFPB director with a commission that would be appointed by the president and confirmed by the Senate. Commission members would serve staggered terms.
“As trade associations representing those institutions supporting America’s consumers, we write to express our support for bipartisan legislation, H.R. 1266, which will ensure the CFPB remains a strong and effective regulator whose mission is to protect consumers regardless of which political party is in the White House,” said the joint statement.
CUNA and the trades noted that CFPB’s “massive jurisdiction includes an entire sector of American finance from banks and credit unions, to innumerable financial service companies of all sizes including larger participants in the financial system, ultimately touching all Americans.”
A five-member, bipartisan board “would provide a sustainable governing structure that allows for an array of expert views from various parts of the retail banking industry; robust and transparent debate; and certainty and stability to a $3 trillion industry,” said the statement.
“Concentrating the CFPB’s authority in a sole director jeopardizes the foundation of the bureau as an objective, neutral consumer protection agency,” CUNA and its partners wrote. A commission would encourage “internal debate and deliberation, ultimately leading to increased transparency.” Its bipartisan and reasoned judgments would “ensure consumers receive the protection they deserve, which in turn would help strengthen the economy; and would avoid the risk of politically motivated decisions causing uncertainty and harm to consumers,” they wrote.
The letter noted that a commission was the originally intended structure for the CFPB. In December 2009, the House passed legislation that would have created a bipartisan commission to oversee the newly formed CFPB. In addition to the overall support from Republicans for a commission, the measure also received support from key Democrat leaders and committee and administration members at the time.
At Thursday’s hearing CUNA’s support of H.R. 2213, which would provide a temporary safe harbor from the enforcement of integrated disclosure requirements for mortgage loan transactions under the Truth in Lending Act and Real Estate Settlement Procedures Act (TILA-RESPA) of 1974 received support from Rep. David Scott (D-Ga.).
Credit unions and banks need more certainty that when they are acting in good faith they won’t be held to litigation, said Scott during discussion of the measure.
H.R. 2213 would address the liability issues associated with delaying enforcement of the TILA-RESPA Integrated Disclosures requirements. CUNA maintains the position that while statements from the National Credit Union Administration and CFPB have been helpful, more needs to be done to ensure that credit unions are not subject to legal liability during the transition period, said CUNA. CUNA supports a safe harbor extension to Dec. 31 to give credit unions time to adjust to the changes.
Other bills of specific interest to credit unions and supported by CUNA that were being discussed at Thursday’s hearing include: