Coinciding with the Consumer Financial Protection Bureau’s (CFPB) recent semi-annual report to Congress, Republicans on the Senate Banking Committee introduced legislation to overhaul the CFPB’s funding structure by making the agency subject to annual congressional appropriations.
The bill, S. 4521, was introduced the same day CFPB Director Rohit Chopra completed the second of two congressional testimonies – one before the Senate Banking Committee and one before the House Financial Services Committee. Congressional Republicans have long sought to bring the bureau under the appropriations process as a means to “rein in” its enforcement and rulemaking activities.
The sponsors of the legislation noted the CFPB is unique among federal agencies in that its funding comes directly from the Federal Reserve based on a request from the bureau’s director. The bureau’s funding structure was upheld by the U.S. Supreme Court earlier this year as constitutional. Sen. Bill Hagerty (R-Tenn.) and Ranking Member Tim Scott (R-S.C.) sponsored the legislation along with seven additional committee Republicans.
The lawmakers noted their opposition to the CFPB’s recent rulemaking proposals aimed at limiting or prohibiting certain fees associated with credit cards, overdrafts and other financial products during Chopra’s recent appearance before the Senate Banking Committee.
“Whether it’s standing with President [Joe] Biden as he unveiled the junk fees campaign or as we saw yesterday with the vice president announcing your new proposal to ban medical debt from credit reports,” Scott said during the hearing. “The political coordination is crystal clear. You’re not protecting consumers or saving people money, instead you’re peddling a false narrative that the Biden administration is doing something to reduce the actual costs.”
Scott introduced a measure in April proposing to overturn the bureau’s credit card fee rule under the Congressional Review Act (CRA) in April. That same month, Rep. Andy Barr (R-Ky.) introduced H.R. 2798, the “CFPB Transparency and Accountability Reform Act,” containing provisions closely resembling those included in the newly proposed Senate bill to put the bureau under appropriations.