By Brandon Moseley
Alabama Political Reporter
On Thursday, July 22, the Consumer Financial Protection Bureau celebrated its fifth birthday. Congressman Gary Palmer (R-Hoover) and other Republican representatives were not pleased with the anniversary.
US Representative Palmer said, “This should be the last birthday the Consumer Financial Protection Bureau (CFPB) celebrates without accountability. For the past five years they have been operating through the use of unappropriated funds from agency imposed fines and fees. Their current budget is $606 million with plans to increase the budget to $636 million next fiscal year. That is way too expensive a birthday gift to give an agency that Congress has never authorized. Congress should make it a top priority to rein in the Federal Government’s overreach of the CFPB and other federal agencies including the IRS and the EPA by passing my bill, the Agency Accountability Act.”
Palmer introduced the Agency Accountability Act on June 16th. HR5499 would require that all fines, fees, penalties, and other unappropriated funds collected by federal agencies to be transferred to the Treasury, and subject to the appropriations process.
Congressman Palmer said then, “Throughout the years, Congress has granted federal agencies the authority to collect fines, fees and other revenues outside of their appropriated funds, but Congress has had little or no say in the way a substantial portion of these monies are spent, which in some instances has led to agency abuse. Congress must begin reclaiming our Article I authority through the power of the purse and put the money back under Congressional oversight where it belongs. I look forward to the support of my colleagues from both sides of the aisle as we work to restore Article I appropriation and oversight authority to Congress.”
The Consumer Financial Protection Bureau (CFPB) and Financial Stability Oversight Council (FSOC) receive no appropriated funds from Congress. The CFPB was set up by Dodd-Frank Act in such a way that their over $600 million per year in funding actually comes direct from the Federal Reserve so their budget is not reviewed by Congress.
Congressman John Ratcliffe (R-Texas) also noted the anniversary. Rep. Ratcliffe in his own statement wrote: “Federal bureaucrats may praise the fifth year of the CFPB’s existence as a victory for its ‘protection’ of consumers – but quite the opposite is true. For yet another year, the CFPB has created immense burdens for community and regional banks while depleting options for consumers across the country – all under little to no accountability to the American people. This is precisely why I teamed up with Ted Cruz last year in introducing legislation to eliminate the CFPB in its entirety with the support of 65 of our conservative colleagues. Five years after it opened its doors, the CFPB continues to roll out regulation upon regulation, and it’s about time this smothering of economic opportunity is put to a stop.”
Rep. Ratcliffe and Senator Ted Cruz (R-Texas) have introduced legislation to abolish the CFPB. Rep. Ratcliffe said, “The CFPB’s regulatory zeal has stripped American consumers and businesses of their freedom of choice and has limited their access to capital – all in the name of a ‘we know best’ attitude from Washington. It seems like every time I go home to Texas and spend time with people across our district, I hear stories about community banks having to choose between closing their doors or consolidating into larger institutions to handle the increase in compliance costs. I hear from businesses forced to spend more time on unnecessary regulatory compliance paperwork than helping serve their customers, and financial institutions that have stopped providing certain basic financial services out of fear of retaliation from the CFPB. I’m grateful to be able to introduce this bill with 46 of my House colleagues in conjunction with Senator Cruz. The CFPB represents exactly what President Reagan warned of – a government smothering opportunity rather than fostering it. We must eliminate the CFPB.”
Sen. Cruz said, “Don’t let the name fool you, the Consumer Financial Protection Bureau does little to protect consumers. The agency continues to grow in power and magnitude without any accountability to Congress and the people. The only way to stop this runaway agency is by eliminating it altogether.”
Critics of the CFPB point that the agency has forced a lot of small banks and small non-bank lenders to go out of the business, it has failed to do anything about the large “too big to fail” banks that the government bailed out in the TARP program to deal with the financial collapse in 2008.
Rep. Palmer’s Agency Accountability Act has been endorsed by the House Freedom Caucus, of which Palmer is a member.
Congressman Gary Palmer represents Alabama’s Sixth Congressional District.