Letter to Chairman Johnson, U.S. Senate Banking, Housing and Urban Affairs Committee

Letter

Banking Committee Republicans Urge Chairman Johnson to Hold Hearings and Mark-up on "Accountable Governance Structure" for CFPB

The Republican members of the Senate Banking, Housing and Urban Affairs Committee joined U.S. Senator Bob Corker, R-Tenn., in a letter today urging committee chairman Tim Johnson to "hold hearings and a mark-up as soon as reasonably possible on legislation to establish an accountable governance structure for the Bureau of Consumer Financial Protection."

"We can protect consumers and ensure accountability at the same time. That is all we are proposing. We hope that President Obama and Senate Democrats will work with us to enact commonsense checks and balances on this massive new bureaucracy," Ranking Member Shelby said."

"As the financial regulatory reform bill was being debated, the creation of a consumer bureau with no accountability and a director who answered to no one was a key issue that began to derail negotiations," said Corker. "While we all believed consumer protections needed to be strengthened, whether Republicans or Democrats are in charge, no one person should have the power the director of the bureau is currently given. Like the businesses they regulate, regulators must be held accountable to someone. Failure to ensure proper checks and balances will always result in regulatory overreach and decisions that miss the mark which in turn stifle risk-taking, innovation and ultimately jobs. I hope the president and Senate Democrats will work with us to appropriately balance the governing structure of the bureau so that we can consider the confirmation of a director who no longer has unchecked regulatory power."

Full text of the letter, signed by all committee Republicans, follows.

Dear Chairman Johnson:

We are writing to request that the Senate Committee on Banking, Housing, and Urban Affairs hold hearings and a mark-up as soon as reasonably possible on legislation to establish an accountable governance structure for the Bureau of Consumer Financial Protection.

Recently, we sent a letter to President Obama stating that we would not support the consideration of any nominee to be the Director of the Bureau until the structure of the Bureau is reformed. As presently structured, we believe that far too much power is conferred on the Director without any effective checks and balances. Accordingly, we urged the adoption of three reforms: creating a board of directors to oversee the Bureau, subjecting the Bureau to the Congressional appropriations process, and establishing a safety-and-soundness check for prudential regulators.

Reforms like these would make the Bureau's governance structure consistent with basic principles of accountability and our democratic values. Indeed, our other independent financial regulators have governance structures with similar checks and balances. We believe that the Bureau should be subject to the same type of accountability. We also note that these reforms would not alter any substantive consumer protection law or regulation.

With your leadership, we believe that Congress can pass legislation to enact common sense reforms on a bi-partisan basis. Prompt passage of these reforms would then allow for the timely consideration of the nominees to the new board of directors for the Bureau before it becomes operational in July.

We look forward to working with you on this matter.

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