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CFPB Goes After Mortgage Market, Enforcement Actions On Deck

The Consumer Financial Protection Bureau is working on a mortgage market “overhaul,” the New York Times reported this week. 

Speaking with CFPB director Richard Cordray about the new agency’s plans, with the mortgage market being at the top of the list, the Times also addresses the Bureau’s critics from mortgage bankers to members of Congress. 

The New York Times writes

The mortgage market is at the top of the agenda because “it’s the market where consumers have the most at risk and they have the most at stake,” Mr. Cordray said. “I expect that the mortgage market in the fairly near term will look different in the sense that, first of all, it will be a clearer and more straightforward place for consumers, and second, it will be a more reliable market.”

…Mr. Cordray said that the consumer bureau’s activities would soon also reflect another part of its mandate — enforcement of consumer protection laws.

“There will be enforcement action this year, and we have quite a bit of activity going on,” he said, though he declined to offer specifics.

Jess Sharp, executive director of the Chamber of Commerce’s Center for Capital Markets Competitiveness, said the bureau needed to be clearer about how it would enforce its rules — beginning with, for example, defining “abusive,” a term included in the Dodd-Frank law but which is new in consumer protection law.

On Capitol Hill, the agency will probably face resistance from Republicans who dislike the creation of a government agency that they say lacks accountability. They want to change the bureau to a five-person commission, subjecting it to greater Congressional control.

“After six months, the only definitive conclusion one can reach about the C.F.P.B. is that it’s a rapidly expanding bureaucracy that is increasing costs on small businesses and remains completely unaccountable to the American people,” said Senator Richard Shelby of Alabama, the ranking Republican on the Senate banking committee.

Read the full article at NYTimes.com.  

Written by Elizabeth Ecker