Consumer bureau lands under leadership of one of its naysayers
Judge clears Trump’s selection of acting chief
WASHINGTON – In naming Mick Mulvaney the acting head of the federal government’s primary financial services regulator, President Trump placed a loyalist in charge of what was designed to be a semi-independent federal agency.
A federal judge ruled Tuesday that Trump could name his budget director to temporarily lead the Consumer Financial Protection Bureau, an Obama-era creation that grew out of the financial crisis of 2008.
Mulvaney’s appointment puts the Consumer Financial Protection Bureau into uncharted waters as it experiences its first change in party control in its seven-year history.
Mulvaney, director of the White House Office of Management and Budget, isn’t just any caretaker director.
At the OMB, he’s responsible for coordinating the president’s federal regulatory policy — but he will also head the CFPB, which Congress set up to be outside the president’s direct influence.
He’s a budget director in charge of what is effectively an off-budget federal agency. The CFPB relies on transfers from the Federal Reserve System rather than annual appropriations from Congress.
He’s a long-standing critic of the agency he now heads. Mulvaney has even called the bureau a joke “in a sick, sad way.”
Mulvaney is in a position to shape the future of the CFPB — created by the Dodd-Frank Wall Street Reform and Consumer Protection Act in 2010.
“The story here is the future of the CFPB and why this person is one of the most unqualified and unsuitable people to head it,” said Mike Calhoun, president of the Center for Responsible Lending, a consumer advocacy group.
Tuesday, a federal judge in Washington ruled that the president can appoint acting agency leaders. Mulvaney tweeted a photo of himself getting to work. On his first day — after crossing the street from his office in the White House complex to bring doughnuts to his colleagues — Mulvaney imposed a 30-day moratorium on new regulations, froze hiring and put a temporary hold on payments to victims of illegal banking practices.
“You should expect that this agency will stay open. Rumors that I’m going to set the place on fire or lock the doors or blow it up are completely false,” Mulvaney said.
“That said,” he continued, “anybody who thinks that a Trump administration CFPB would be the same as an Obama administration CFPB is simply being naïve. Elections have consequences at every agency, and it includes the CFPB.”
Mulvaney, a former Republican congressman who spearheads the Trump administration’s efforts to roll back regulations across the government, controls an agency whose decisions impact any American with a checking account, mortgage, credit card or consumer loan.
“The fact of the matter is that the director — the permanent director, whoever the president nominates — will also share the president’s agenda,” said Richard Revesz, a law professor at New York University.
“Rumors that I’m going to set the place on fire or lock the doors or blow it up are completely false.”