A Positive Policy Agenda for CFPB Director Kathy Kraninger

The Consumer Financial Protection Bureau has been controversial since its creation. As an executive agency enjoying Federal Reserve funding independent of the Congressional appropriations process —and run by a single director removable only for cause—the Bureau is unusual andpossibly unconstitutional. In its first years of existence, the CFPB gained a reputation for its exceptional activism and anti-industry agenda. Curiously, many of its enforcement and rulemaking activities focused on areas that were explicitly outside of its regulatory remit —such asauto lending,federal student loans, and credit providers historically regulated at the state level, such aspayday lenders.When Mick Mulvaney replaced Richard Cordray as CFPB Director, he vowed to stop“pushing the envelope” in its approach to regulation. Progressive fans of the Bureau took this as a sign that Mulvaney would terminate the CFPB ’s enforcement activities altogether, an expectation thatsubsequent developments belie. Still, the financial industry, wary of the Bureau ’s exceptional powers, breathed a sigh of relief that the Cordray-eramodus operandiof attempting to change industry practices, even legal ones, through threats of lengthy and expensive enforcement actions might be over.Now Mulvaney ’s replacement Kathy Kraninger has the unenviable task of crafting a policy agenda for the CFPB that raises consumer welfare and promotes choice, competition, and innovation in the provision of credit. To assure...
Source: Cato-at-liberty - Category: American Health Authors: Source Type: blogs