Trump’s pick for acting CFPB director is good news for consumers & financial innovation

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CEI Director of Finance Policy John Berlau praised President Trump’s pick to act as head of the Consumer Financial Protection Bureau, following the firing of Biden-appointed director Rohit Chopra over the weekend.

Statement by John Berlau:

President Trump’s appointment today of Treasury Secretary Scott Bessent to serve as Acting Director of the CFPB is great news for American consumers, community banks, and credit unions.

During Chopra’s tenure under the Biden administration, the CFPB took several actions that increased costs and limited choices for American consumers and weaponized financial regulation to punish certain viewpoints. As an advocate of deregulation, Bessent should use his time as acting director to halt destructive pending rules and get rid of red tape from Chopra’s CFPB until a confirmed director and Congress can pursue long-term reforms of the unaccountable agency. Among the Chopra CFPB’s most egregious actions were:

  1. Attempting censorship through litigation against the Townstone Financial nonbank mortgage firm for mere speech about neighborhood crime in the Chicago area. The CFPB pursued a complaint against the firms claiming that Townstone created a discriminatory atmosphere through statements made on the firm’s radio show and podcast that simply decried the crime rates of certain local neighborhoods.
  2. Slapping $8 price controls on credit card late fees that threatened to raise costs on the vast majority of credit card holders who make their payments on time.
  3. Giving itself “supervisory authority” to access sensitive customer data of FinTech firms, even though the CFPB has yet resolve its own data breach in which a CFPB employee forwarded confidential information of 256,000 consumers to a personal email account.

Bessent should halt all rulemaking and review all pending enforcement cases. Congress should prioritize changing the CFPB’s funding structure so that it is subject to the congressional appropriations process, rather than having the Federal Reserve as its source of funds. The heart of the problem is that the Dodd-Frank financial law set up the CFPB to bypass the congressional appropriations process. This structural flow allows the CFPB to escape accountability for regulation that imposes big costs on community banks, credit unions, and consumers.

Related:

John Berlau and Stone Washington, “Trump must cancel CFPB censorship,”

John Berlau, “CFPB fintech power grab,”

John Berlau and Devin Watkins, video, “The CFPB is Insulated from Political Accountability,”