House GOP Bills Attack Consumer Financial Protection Bureau

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You can hardly turn on a television these days without seeing Sen. Elizabeth Warren's smiling face. One moment she's wistfully describing the bygone days of her youth, when a kid from a minimum-wage family could grow up to become a professor at Harvard. The next, she's chastising America's "too big to fail" banks for "rigging" the game against middle class America today.

Promoting her new book, "A Fighting Chance," in near back-to-back appearances on Comedy Central's "The Daily Show with Jon Stewart" and "The Colbert Report," the Massachusetts Democrat describes her own role in setting up the Consumer Financial Protection Bureau before winning a seat in the U.S. Senate. But now that Warren is busy senator-ing, can the bureau survive without her?

That's the worry over at the nonprofit consumer research advocacy group Consumer Federation of America, which recently warned of a multi-pronged attack on the bureau from Republicans in Congress. At last count, House GOP members have put forward 11 bills aimed at pulling the teeth of the agency and preventing it from doing its job of protecting American consumers.

Rachel Weintraub, legislative director of the federation, warns that, if passed, "these bills will thwart the progress that CFPB has made" towards "helping consumers and ensuring that our market place is more fair." What's more, if they become law, the bills threaten to "tie [the CFPB's] hands in the future." Here's a quick rundown of five of the more egregious (or just plain silly) legislative acts Congress is proposing:

1. Keep Your Unidentifiable Information Unidentifiable

Are you worried about government agencies collecting personal information about you? Many people are -- and so are some members of Congress. That's why they want to pass the CFPB Data Collection Security Act, permitting consumers to opt out from allowing the bureau to collect personally identifiable information about them.

Of course, the bureau doesn't collect such personally identifying information -- making this law about as useful as a one banning unicorns from grazing on the White House lawn.

2. You Do Not Have the Right to a Trial

Have you ever read the contract that comes with a credit card? You may have noticed a clause that mandates, if you ever get into a dispute with your card company, that you must settle that dispute through arbitration -- and give up your right to sue the card company in court.

The proposed Bureau Arbitration Fairness Act sees absolutely nothing wrong with such a "voluntary" renunciation of your Constitutional right to a fair trial. The bill would forbid the bureau from doing anything to limit credit card companies' right to force you to give up this right.

3. What's Yours Is Ours

What are the chances that a dishonest financial institution, after defrauding you and taking your money, might then up and declare itself insolvent so it doesn't have to pay you back? Think it could happen? If so, then you won't be at all pleased with this next proposed law.

Right now, the CFPB collects the fines it imposes on bad actors, and among other things, uses that money to compensate consumers harmed by banks' misdeeds. The proposed CFPB Slush Fund Elimination Act of 2013 aims to confiscate all that money for the Federal Reserve -- and if the Fed gets the dough, good luck ever getting paid back if you find yourself stung by financial fraud.

4. All the News Printed Won't Fit

The proposed Bureau Research Transparency Act would require the bureau to give context to any reports it publishes, by publishing any studies, data or analyses "related" to the material in its reports, when the latter are published. That seems like an awful lot of trees being needlessly killed in the age of the Internet. A detailed bibliography online should suffice.

5. If We Want Your Opinion, We'll Give It to You

The publication of official reports is only the beginning. The proposed Bureau Guidance Transparency Act would require the bureau to take public comments before so much as issuing "guidance" on how it wants financial institutions to comply with its regulations. Put another way, Congress is saying it would rather the bureau not even voice opinions on how laws should be enforced, until others have had a chance to chime in and tell the bureau what those opinions should be.

Speaking of opinions, these are just five of the opinions that Republican members of Congress are suggesting to the bureau. But they're probably more than enough for you to figure out their general opinion of the bureau: If at all possible, they'd really prefer that the Consumer Financial Protection Bureau did not exist. But failing that, preventing the bureau from doing any good for consumers, or any harm to legislators' Big Banking campaign contributors, will suffice.

Motley Fool contributor Rich Smith has a few bank accounts but owns no stock any financial institution subject to CFPB oversight.​

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32 Comments

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jim.lapt

The GOP are evil, they want to impeach our wonderful president, Barack Hussein Obama.
Did I tell you that my hubby is a pilot and makes six figures ? I'm glad president Obama approves gay marriage. My hubby Jim and I just tied the knot a few months ago. He bought us a new A6 for a wedding gift. I love him soooo much.

May 28 2014 at 1:48 PM Report abuse -1 rate up rate down Reply
1 reply to jim.lapt's comment
ign.cmk

Weak minded people, like yourself, flock to the GOP. You're like moths to a light.

May 29 2014 at 8:15 AM Report abuse rate up rate down Reply
egoad25236

The Taliban (AKA Republicanss) won't stop until working people in this country are in total poverty, while their rich sponsors have it all their way. The American peoople had better wake up.

May 28 2014 at 8:44 AM Report abuse +1 rate up rate down Reply
george3373

first elizabeth warren has been caught lying and cheating numerous times. Its documented just look up her applications to harvard as a start.
Second she is not liberal she is off the chart progressive. But a hypocrit as she already is rich and in the 1%
If you have credit cards and do not read the fine print it is your fault. Do not be like pelosi and other liberals who passed a bill of 2700 pages and never read it and after five years still do not know what is in it.

May 28 2014 at 8:10 AM Report abuse -1 rate up rate down Reply
ctheleroys

Time to STOP using credit cards all together!!Lets see how far they get with NO CUSTOMERS!! Banks have gone too far!! JERKS!!

May 28 2014 at 7:58 AM Report abuse rate up rate down Reply
Michael

Is anyone really surprised? There is not one word in these bills that protects the 1%.

May 28 2014 at 7:37 AM Report abuse +2 rate up rate down Reply
Samella

The republicans are doing everything they can to destroy this country.

May 28 2014 at 6:15 AM Report abuse +3 rate up rate down Reply
teaparty2implode

CEO Pay 1,795-to-1 Multiple of Wages Skirts U.S. Law

Former fashion jewelry saleswoman Rebecca Gonzales and former Chief Executive Officer Ron Johnson have one thing in common: J.C. Penney Co. (JCP) no longer employs either.

The similarity ends there. Johnson, 54, got a compensation package worth 1,795 times the average wage and benefits of a U.S. department store worker when he was hired in November 2011, according to data compiled by Bloomberg. Gonzales’s hourly wage was $8.30 that year.

Across the Standard & Poor’s 500 Index of companies, the average multiple of CEO compensation to that of rank-and-file workers is 204, up 20 percent since 2009, the data show. The numbers are based on industry-specific estimates for worker compensation.

Almost three years after Congress ordered public companies to reveal actual CEO-to-worker pay ratios under the Dodd-Frank law, the numbers remain unknown. As the Occupy Wall Street movement and 2012 election made income inequality a social flashpoint, mandatory disclosure of the ratios remained bottled up at the Securities and Exchange Commission, which hasn’t yet drawn up the rules to implement it. Some of America’s biggest companies are lobbying against the requirement.

“It’s a simple piece of information shareholders ought to have,” said Phil Angelides, who led the Financial Crisis Inquiry Commission, which investigated the economic collapse of 2008. “The fact that corporate executives wouldn’t want to display the number speaks volumes.” The lobbying is part of “a street-by-street, block-by-block fight waged by large corporations and their Wall Street colleagues” to obstruct the Dodd-Frank law, he said

May 27 2014 at 11:51 PM Report abuse +1 rate up rate down Reply
jojosdixoutcider

Hey Cons how about doing something useful for your constituents for a change? Guess that is an awful lot to ask of a party that has nothing to run on.

May 27 2014 at 7:58 PM Report abuse +8 rate up rate down Reply
hustonlaw

Nothing better for those dorks to do? Like passing immigration legislation?

May 27 2014 at 7:12 PM Report abuse +6 rate up rate down Reply
teabuster2

To the GOP scamming is good entrepreneurship

May 27 2014 at 7:09 PM Report abuse +11 rate up rate down Reply
1 reply to teabuster2's comment
teaparty2implode

Yes...... capitalize now on your fellow man....... rip him off........take him now for everything he's got.

May 27 2014 at 11:18 PM Report abuse +3 rate up rate down Reply