The head cop at the new Consumer Financial Protection Bureau outlined the agency’s initiatives during a speech on Tuesday.
Speaking at the National Association of Attorneys General’s spring meeting, Richard Cordray, the bureau’s head of enforcement, said the agency will protect consumers from unfair, deceptive, or abusive acts and use its authority to go after bad actors in the marketplace.
“Rooting out these bad actors will be good not only for consumers, but also for community banks and other financial companies that are committed to honest dealing and quality customer service,” he said.
As mandated by Congress, the agency seeks to level the playing field so that bank and non-bank providers of consumer financial products and services can compete freely and fairly. “And we will be in a great position to do this because, for the first time, there will be one agency with supervisory authority over non-bank providers, as well as all of the nation’s largest banks.”
All of this authority has some in Washington worried and Republicans are working to limit the amount of funding available to the CFPB. As passed by Congress, the bureau was provided a direct allocation of funding from the Federal Reserve. But Republicans have been fighting to reduce the funding and pull it out of the Fed so it can be distributed through the appropriations process. The House GOP passed a spending bill that reduces the Fed’s funding by about 40% to $80 million for next year.
Without that funding, the bureau will have a difficult time overseeing the non-bank sector, which has never been supervised by a Federal agency said Cordray.
“That is why it is so critical that the Consumer Bureau retains its independent funding model, a model that will allow it to respond rapidly and appropriately to legal violations and changes in the marketplace over time,” he said.