Freddie Mac (FMCC)

[Ace Trader]

Bill Introduced to Turn CFPB Into Independent Agency

https://www.cutimes.com/2023/03/08/bill-introduced-to-turn-cfpb-into-independent-agency/?amp=1

https://barr.house.gov/press-releases?id=366A7336-D24F-4284-8051-A6B4D33EA42D

The TABS Act comes on the heels of the Supreme Court agreeing to hear a case that may dismantle the bureau.

Chairman of the House Financial Services Subcommittee on Financial Institutions and Monetary Policy Rep. Andy Barr (R-Ky.) reintroduced the Taking Account of Bureaucrats’ Spending (TABS) Act on Wednesday, which would place the CFPB into the congressional appropriations process and turn it into an independent agency.

According to Rep. Barr, the TABS Act would subject the CFPB to the traditional congressional appropriations process, like many other federal agencies. “Furthermore, the TABS Act would make the CFPB an independent agency named the Consumer Financial Empowerment Agency,” said a statement posted on Barr’s website.

“The CFPB is the most unaccountable and authoritarian agency in the entire federal bureaucracy. I’m leading this legislation to give the CFPB the wholesale makeover it needs to finally be accountable to Congress,” Barr said. “The Fifth Circuit Court of Appeals and prominent legal scholars have been clear that the CFPB’s novel and unique funding structure is unconstitutional by violating the Appropriations Clause. The TABS Act corrects this by requiring the Bureau to go through the traditional federal appropriations. The special treatment the CFPB has been receiving that has allowed for reckless spending and regulatory overreach will come to an end with the passage of the TABS Act. This allows Congress to use its most powerful tool – the power of the purse – to ensure this CFPB is actually about consumer empowerment and not another vehicle for left-wing bureaucrats to advance the power of the administrative state.”

CUNA President/CEO Jim Nussle applauded Barr’s reintroduction of the legislation. “We thank Rep. Barr for his legislation, which supports CUNA’s longstanding position that the CFPB is funded through the appropriations process. The CFPB’s actions and policies impact a massive part of the global economy, and we support actions to make the agency more transparent and accountable,” Nussle said.

“Congressman Barr is a tireless champion of regulatory relief and has demonstrated his commitment to battling burdensome regulatory overreach, Kentucky Credit Union League President/CEO Debbie Painter said. “This bill is another example of those efforts. We look forward to working with Congressman Barr and his team on this bill and others to promote growth and fairness within the financial industry.”

The CFPB has increasingly become the focus of lawmakers and judicial experts as of late. On Feb. 27, the Supreme Court announced that it will hear a 2017 case in which the U.S. Court of Appeals for the Fifth Circuit in New Orleans ruled last October that the CFPB operates outside of what it considers a constitutional imperative that agencies be funded from direct appropriations by Congress.

Last week, officials with NAFCU stated the potential pitfalls if the CFPB were to be dismantled. Ann Petros, vice president of regulatory affairs, said NAFCU opposes a decision “that would upend the CFPB and could put the consumer financial services industry into chaos.”

“What we don’t want is the CFPB dismantled,” Petros said. “It should continue to operate.”

If the CFPB is deemed to be unconstitutional, the actions it spawned might also be considered illegitimate. Petros said this could raise questions of the validity of a host of current lending rules, such as those governing mortgage originations or car lending.

“There would be a question if people could close loans,” Greg Mesack, NAFCU’s SVP of government affairs, said. “It could have a devastating impact on people buying homes, buying cars.”

It’s expected the Supreme Court will hear the case this fall and announce its ruling in 2024.