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Debate Still Rages Over CFPB After First 100 Days

The feud between lawmakers over the ""Consumer Financial Protection Bureau"":http://www.consumerfinance.gov/ (CFPB) dragged on Wednesday, as de facto acting director ""Raj Date"":http://cambridgewinter.org/Cambridge_Winter/Raj_Date.html defended the struggling agency to Republican House members and the role of the Dodd-Frank Act in financial regulation.

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Date, currently a presidential advisor with the ""Treasury Department"":http://www.treasury.gov/Pages/default.aspx, portrayed the CFPB as a work-in-progress striving to strike an impartial tone as the nation's chief regulator of consumer financial products.

""We will not shoot from the hip. We will not reason from ideology. We will not press a political agenda,"" he said in opening remarks. ""Instead, we are going to be fact-based, pragmatic, and deliberative.""

Republicans advanced their critiques by highlighting the apparent power of the CFPB director and more compliance workload for financial institutions.

Reiterating concerns from his party, ""Rep. Spencer Bachus"":http://bachus.house.gov/ (R-Alabama), committee chairman, said that he fears ""there are simply no checks and balances.""

Inquiring about mortgage disclosure reform, a prime goal for the agency, ""Rep. Blaine Luetkemeyer"":http://luetkemeyer.house.gov/ (R-Missouri) described onerous regulation that he said made one banker he knew hire five new staff members merely for compliance needs.

At other times, as in past hearings, lawmakers ratcheted up the rhetoric in the debate over consumer financial protection.

Pressed by Luetkemeyer over when the CFPB plans to

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streamline complex rules under the Home Mortgage Disclosure Act, Date demurred by saying that it could take anywhere from two weeks to two years, a remark to which the lawmaker replied by quipping, ""You must work for the government.""

Democratic lawmakers played their part by praising the bureau, with ""Rep. Barney Frank"":http://frank.house.gov/ (D-Massachusetts) describing ""feedback from the lending community that... they're really quite happy"" with mortgage disclosures and other changes.

""Rep. Luis Gutierrez"":http://www.gutierrez.house.gov/ (D-Illinois) compared recent arguments against the bureau with those leveled against the ""FDIC"":http://www.fdic.gov/ in the 1930s, beginning his remarks by reading from a nearly 80-year-old ""American Bankers Association"":http://www.aba.com/default.htm statement that called the latter agency ""unsound, unscientific, and dangerous.""

""We hear things like, the CFPB isn't accountable to Congress, or the CFPB has unprecedented power. I would like to suggest, as I have before, that the CFPB is not the boogeyman,"" he said, calling the bureau a ""commonsense regulator.""

The hearing continues a debate on Capitol Hill over the bureau unchanged since lawmakers passed Dodd-Frank, which transferred rules under 18 consumer financial protection laws from seven federal regulators to the CFPB when it went live in July.

Authorities since then have withdrawn CFPB architect ""Elizabeth Warren"":http://elizabethwarren.com/announcement from the nomination process, replaced her with enforcement chief Richard Cordray, and hired 700 new regulators and staff to the payrolls, many of which Date said came from other agencies.

At times the hearing fixated on the lack of a director, with the acting director calling attention to the bureau's inability to regulate nonbank financial institutions without one.

Now the bureau's director-nominee, Cordray remains locked in the same partisan process, with 44 Republican senators pledging to deny a vote for any single director ""President Barack Obama"":http://www.whitehouse.gov/administration/president-obama/ nominates.

Not that the fight is entirely one-sided: ""37 state attorneys general recently signed a letter"":https://themreport.com/articles/thirty-seven-ags-back-cordray-for-cfpb-director-2011-10-18 praising Cordray and calling for his confirmation.

About Author: Ryan Schuette

Ryan Schuette is a journalist, cartoonist, and social entrepreneur with several years of experience in real-estate news, international reporting, and business management. He currently lives in the Washington, D.C., area, where he freelances for DS News and MReport.
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