New policy in store for financial bureau

NEW YORK — The new head of the Consumer Financial Protection Bureau is reversing yet another policy set by her predecessor by giving more sway to committees that advise the financial watchdog.

Bureau Director Kathy Kraninger said Thursday that she would lengthen the tenure of members of the Consumer Advisory Board and three other committees to two years, and would allow half of the committees’ existing membership to continue serving. The agency also would increase the number of in-person board meetings per year from two to three.

Mick Mulvaney, who ran the bureau for President Donald Trump on a temporary basis until December, dissolved the Consumer Advisory Board and other groups, which act as a sounding board for the agency on important economic and financial issues as well as policy. Consumer groups had expressed anger at the move, saying it stopped important dialogue between the Consumer Financial Protection Bureau and outside groups.

The bureau is a highly independent agency, and receives its budget not from Congress but from the Federal Reserve, which allows the bureau to act as it wishes without the support of Congress. However when Congress created the Consumer Financial Protection Bureau, it required that the bureau create advisory boards consisting of community members, banks, credit unions and academics to advise the bureau on policy decisions. The bureau was required by law to meet with these groups at least twice a year.