Will a new consumer bureau director heed the agency’s mission?
CHARLENE CROWELL | 12/28/2018, 4:23 p.m.
Center for Responsible Lending
In her first news conference as a Senate-confirmed director of the Consumer Financial Protection Bureau, Kathleen Kraninger’s remarks sounded a lot like Mick Mulvaney, her former boss at the Office of Budget and Management.
On Dec. 11, just one day into a five-year term of office, Kraninger told reporters she would continue the business-friendly work begun by Mulvaney.
Days earlier, on Dec. 6, Kraninger was confirmed to the position by a 50-49 party line vote. However, a broad and diverse coalition comprised of national and state organizations have pledged to valiantly stand up for consumers and their financial rights.
Labor advocates like the AFL-CIO and the Service Employees International Union; civil rights stalwarts NAACP, UnidosUS (formerly the National Council of LaRaza) and the Leadership Conference on Civil and Human Rights; and consumer advocates like Americans for Financial Reform and Center for Responsible Lending are all among the groups lending their names and influence to the effort.
“She won’t answer questions. She won’t release documents. She let industry attend her swearing in but not the public. Now she’s forcing important members of the media out of the room during her first press availability as CFPB director. What is Kathy Kraninger hiding?” asked Karl Frisch, executive director of Allied Progress.
“This is not how a CFPB director committed to transparency and accountability operates. We deserve better,” added Frisch.
Kraninger arrives to CFPB’s top job with no experience protecting consumers or in financial regulation. Nor does she bring experience in directing a large government agency. While at OMB, she was considered a midlevel appointee.
Earlier, Kraninger was asked a series of questions by the Senate Committee on Banking, Housing and Urban Affairs. One of the questions posed was, “Can you identify any actions he [Mulvaney] has taken that you disagree with and explain why you disagree?” Kraninger responded, “I cannot identify any actions that Acting Director Mulvaney has taken with which I disagree.”
Under Mulvaney’s leadership, the CFPB was transformed from a vigilant consumer advocate into a servant for corporations. Just a few of the anti-consumer actions taken by Mulvaney include a lack of enforcement of the nation’s fair lending laws, rollbacks of consumer protections, and suppression of the CFPB’s Student Loan Ombudsman report that found how high fees were charged to college students by major banks.
Most importantly, even in the handful of cases brought under Mulvaney against financial actors who defrauded and abused consumers, next to nothing was paid in restitution – monies that could help make consumers whole financially.
Instead of enforcement, many consumer activists would view that lack of action as simply a business-friendly pass.
For the nation’s consumers, however, financial fairness – rules that eliminate debt traps including payday loans, as well as restitution from lawsuits that earlier returned nearly $12 billion to those who had been financially harmed – could seem like CFPB’s history but not its current focus.
What happens over the next five years will test the mettle of those who fought to create an agency given the mission to protect consumer finances against profiteers who argue that baseline protections for consumers are an unnecessary burden to business.