New Jersey, Other States Look to Fill CFPB’s Regulatory Void

Faced with a changing landscape at the Consumer Financial Protection Bureau, one state’s Democratic elected officials are taking regulatory matters into their own hands.

New Jersey Gov. Phil Murphy promised to create “a state-level CFPB” in his successful campaign last fall, and his attorney general recently framed the appointment of a new watchdog official as a major step toward achieving that goal.

Paul Rodriguez was nominated to serve as director of the New Jersey Division of Consumer Affairs, with state Attorney General Gurbir S. Grewal classifying the move as a strike against the Trump administration’s anti-regulatory policies.

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“As the federal government abandons its responsibility to protect consumers from financial fraudsters, it is more important than ever that New Jersey picks up the mantle to protect its own residents,” Grewal said in a statement announcing Rodriguez’s appointment. “Paul has the energy and ability necessary to lead the the division as we work to protect New Jerseyans from fraud and professional misconduct in the marketplace.”

Created by the Dodd-Frank financial reform package of 2010, the CFPB enjoyed widespread support and a robust regulatory role in the Obama administration. Under his successor, however, the CFPB has made a sharp turn, with acting director Mick Mulvaney taking steps to slash its budget and pull back on enforcement actions.

Rodriguez will replace Sharon Joyce, who is leaving the state’s consumer affairs office to lead an anti-addiction initiative. He will assume the role of acting director on June 1, in advance of a formal nomination that must be confirmed by the state senate.

Pennsylvania Attorney General Josh Shapiro made a similar move last year, law firm Buckley Sandler LLP noted in an analysis last week, and 17 state attorneys general wrote a letter to the president objecting to Mulvaney’s appointment.

“With state attorneys general dedicating additional resources to consumer protection matters and a more measured CFPB agenda at the federal level, companies should begin examining whether their compliance management programs appropriately account for enforcement and regulatory priorities that current and soon-to-be-elected state attorneys general have identified,” Buckley Sandler warned.

Rodriguez currently serves as the acting counsel to New York City Mayor Bill de Blasio, a Democrat. He was previously an associate at a New York City law firm and worked for former U.S. Sen. Frank Lautenberg of New Jersey.

Written by Alex Spanko

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  • I still think they don’t get it! The Consumer Financial Protection Bureau “CFPB” is any thing but a bureau to protect the consumer!

    The Dodd-Frank bill was a subterfuge bill and a camouflage to ride heard over and control our entire financial industry.

    The CFPB was only a committee formed to have autonomous controls and powers over our banks, lending operations, financial markets and you name it!

    The answer is not to have states like New Jersey create their own state-level CFPB,s but to have the Federal Government and congress repeal the Dodd-Frank bill completely and do away with the CFPB, once and for all!

    John A. Smaldone
    http://www.hanover-financial.com

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