Bureau Director Rohit Chopra faces further criticism from GOP members at Senate Banking Committee hearing.
As the 117th Congress draws to an end, Republican senators called on their colleagues to quickly pass legislation that would subject the CFPB to the annual appropriations process and convert it into a five-member commission.
“I acknowledge there are other financial regulators not on appropriations—and we can disagree about whether they should be,” Senate Banking Committee ranking Republican Sen. Pat Toomey of Pennsylvania said during a hearing Thursday. “But it’s indisputable that Congress has precisely zero leverage over the CFPB.”
The hearing marked the second day in a row that agency Director Rohit Chopra testified on Capitol Hill. On Wednesday, he appeared before the House Financial Services Committee, where Republicans sharply criticized him for what they consider as regulatory over-reach.
During Thursday’s Senate hearing, members of both parties spent much of the session paying tribute to Toomey and panel member Sen. Richard Shelby, R-Ala., both of whom are retiring at the end of the year.
Ranking Republican Takes Aim at CFPB Leader
For his part, Toomey focused his attention on criticizing Chopra’s tenure at the CFPB.
He noted that the Fifth Circuit Court of Appeals has ruled that the agency’s funding mechanism is unconstitutional because it is not funded through the annual appropriation process.
The Biden Administration has asked the U.S. Supreme Court to overturn that decision, but Toomey predicted that the court, controlled by conservatives, would uphold the ruling.
To solve uncertainty around the agency, he implored Congress to pass his bill, which, he said, “in no way would end the CFPB,” but rather provide accountability to an agency he sees as out of control.
“You can choose to ignore everything we say here and there’s nothing we can do about it,” he told the bureau’s director.
Added Toomey, “The last time Director Chopra testified, I raised concerns about the CFPB’s overreach in pursuit of a far-left agenda. Unfortunately, this lawless behavior is nothing new for the CFPB, and under Director Chopra, it’s more out of control than ever before.”
Specifically, Toomey accused the CFPB of conducting a “smear campaign” against banks that charge overdraft fees. He also contested the agency’s proposal to regulate discrimination in financial services under its power to police Unfair, Deceptive or Abusive Acts or Practices, saying the bureau does not have that authority.
Support for CFPB From Across the Aisle
Democrats jumped to Chopra’s defense.
“No other agency fights for consumers like the CFPB,” Senate Banking Committee Chairman Sen. Sherrod Brown, D-Ohio, said. “It’s no wonder Wall Street hates the agency. Since the passage of Dodd-Frank, Wall Street and its allies have aimed their fire at the CFPB, trying over and over again to undermine and gut the agency responsible for fighting for Main Street and consumers.”