House Passes Bill to Revamp CFPB

Passing a bill aimed at reforming the agency, House lawmakers showed no sign of stopping in their attempts to reform the ""Consumer Financial Protection Bureau"":http://www.consumerfinance.gov (CFPB) just one day after it officially opened its doors.

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On Thursday the lower chamber pushed through H.R. 1315, titled the Consumer Financial Protection Safety and Soundness Improvements Act, which ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô contingent action from the Senate and a reconciliation process between both houses ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô would swap the director for a five-member commission and strengthen the ""Financial Stability Oversight Council"":http://www.treasury.gov/initiatives/Pages/FSOC-index.aspx (FSOC) by requiring only a simple majority vote to veto new bureau rules and regulations.

""I think when we look at this, we all have to agree that you can't separate safety and soundness from consumer protection,"" ""Rep. Sean Duffy"":http://duffy.house.gov/ (R-Wisconsin), who introduced the legislation, read from a statement before the House financial institutions subcommittee. ""We all ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô again ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô want consumers to be protected, we want it to be a system that's fair and transparent.

""But in our mission to have a fair and transparent system, if it undermines safety and soundness, and our banking system fails, the consumer fail, the American people fail, our economy fails,"" he added.

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In an online post, the ""House Financial Services Committee"":http://financialservices.house.gov/legislation/Default.aspx?postid=238384 underscored the imperative for the reform it aims to implement, ascribing ""far-reaching implications"" to the powers prescribed by the Dodd-Frank Act for the CFPB.

The committee called the ""review process├â┬ó├óÔÇÜ┬¼├é┬ª essentially meaningless,"" citing ""virtually impossible prerequisites"" the FSOC needed to meet in order to check CFPB rules, including a two-thirds vote, the need to find systemic endangerment in the financial industry, and statutory limitations on the review process, such as a 90-day review period.

The post went on to praise H.R. 1315, saying that it ""improves the FSOC review process"" by adding powers and leeway for action to the council.

The bill's passage comes on the heels of reform efforts in the Senate, where 44 Republicans continue to hold firm on a pledge to similarly replace the director with a board and establish safety-and-soundness checks.

""Given the fundamental flaws with the existing structure of the Bureau├â┬ó├óÔÇÜ┬¼├é┬ª the Senate should not confirm any person to lead the Bureau until some reasonable reforms are adopted,"" ""Sen. Richard Shelby"":http://shelby.senate.gov/public/ (R-Alabama) said in a Tuesday hearing, referencing structural changes the upper chamber wants for the CFPB. ""Those who are advocating for more accountability have been accused of trying to ├â┬ó├óÔÇÜ┬¼├ï┼ôgut', ├â┬ó├óÔÇÜ┬¼├ï┼ôcripple', or ├â┬ó├óÔÇÜ┬¼├ï┼ôdefang' the Bureau.""

In the face of the House's bill and Senate efforts, a recent ""Lake Research Partners"":http://lakeresearch.com/ poll, as released by the ""Center for Responsible Lending"":http://www.responsiblelending.org/, holds that nearly three-quarters of voters agree with the creation of a single, credible bureau. According to the poll, 83 percent of Democrats and 68 percent of Republicans favor a strong CFPB.

The CFPB went live yesterday, as ""reported"":https://themreport.com/articles/one-year-later-cfpb-goes-live-2011-07-21 by MReport.com.