Senate Banking Committee chairman Tim Johnson, D-S.D., late this week rebuffed Republican demands to take up legislation that would restructure the governance of the Consumer Financial Protection Bureau.
Chairman Johnson said he is not going to "re-legislate" the bureau before the new agency is launched in July and has a chance to do its job. "Republicans opposed a strong consumer watchdog from the start, and now they are at it again," Johnson said in a statement.
Establishing the consumer bureau was one of the most contentious issues last summer when Democratic lawmakers were trying to pass the Dodd-Frank Act. To ensure the bureau's independence, former Banking Committee chairman Christopher Dodd, D-Conn., decided the bureau should be run by a single director and funded by the Federal Reserve Board, making it immune from the congressional appropriation process.
Still, committee Republicans are urging chairman Johnson to act on a bill that would force the CFPB director to answer to a board of directors and seek its funding from congressional appropriators. "I hope the president and Senate Democrats will work with us to appropriately balance the governance structure of the bureau so that we can consider the confirmation of a director who no longer has unchecked regulatory power," Sen. Bob Corker, R-Tenn., said.
Republicans have threatened to block the confirmation of a director until the CFPB is restructured. The new consumer bureau is slated to be up and running on July 21. President Obama is expected to by-pass the Senate confirmation process and appoint the first CFPB director after Congress leaves Washington for its August recess.
Sen. Johnson said the bureau is already subject to greater checks and balances than any other financial regulator. "This is just another attempt to delay and derail these critical new protections," he said."
