Keep CFPB Reform Out of Budget Bills: Dem Lawmakers

Register now

Progressive Democrats sent a letter to Congressional leadership on Thursday urging them not to pass a budget bill that would reform the Consumer Financial Protection Bureau and other components of the Dodd-Frank Act.

"Congress must not include in end-of-year funding legislation any riders designed to repeal, undermine, or delay any provisions of Wall Street reform," said the letter from Sen. Sherrod Brown, D-Ohio., and Rep. Maxine Waters, D-Calif., to the leaders of the House and Senate.

Congress passed a stopgap funding in bill in September that will expire Dec. 9. With the House and Senate back in session after more than a month in recess, they will begin budget negotiations again which could ultimately include another stopgap measure that keeps funding at the same levels.

However, funding bills often carry policy riders like the one the House passed in July that would change the structure of the CFPB from a single director to a commission and subject it's funding to Congressional approval.

A Senate funding bill that was voted out of committee in June, but not approved by the chamber, did not include the same policy riders.

Brown is the lead Democrat on the Senate Banking Committee, while Waters is his counterpart on the House Financial Services Committee. In their letter, they both expressed concern that reforming the CFPB as the House bill would do could hurt consumers.

"Given the recent scandal at Wells Fargo, where the banks' employees were under pressure from bank management to open as many customer accounts as possible, it's clear that our financial markets need stronger rules and oversight, not less," the lawmakers wrote. "We remain opposed to efforts to include any provisions that repeal, undermine, or delay consumer or investor protections, or deregulate our financial system in any end-of-the-year funding legislation."

Yet some banking industry representatives, including Richard Hunt, president and chief executive offer of the Consumer Bankers Association welcomed the House bill when it was passed out of committee.

"We applaud House appropriators for taking steps to make needed improvements to the CFPB on behalf of consumers," said Hunt at the time. "Chief among the reforms is the creation of a five-person, bipartisan board that would preserve it as a stable, strong and effective regulator."

While budget negotiations will continue, lawmakers have sent signals that they would prefer to agree to extend the funding that is set to expire in December and renegotiate in the next Congress.

"The bottom line is that we must fulfill our constitutional duty to responsibly fund the federal government, and do right by the taxpayers who have elected us," said Rep. Hal Rogers, chairman of the House Appropriations Committee in a statement Thursday. "My committee will begin working immediately on a Continuing Resolution at the current rate of funding to extend the operations of our government through March 31, 2017."

For reprint and licensing requests for this article, click here.