Thursday, December 7, 2017

Last Call For Who's The Boss?

I mentioned last week that the growing battle over the future of the Consumer Financial Protection Bureau was in full effect, as Richard Cordray left the agency to run for Governor in Ohio.  He left the agency to its deputy director, but Trump appointed his budget direct Mick Mulvaney to run the agency.

A federal court sided with Mulvaney, and within a week, the "Consumer" has all but been removed from the title of the agency, it's now very much the Financial Protection Bureau.



The defanging of a federal consumer watchdog agency began last week in a federal courthouse in San Francisco. 
After a nearly three-year legal skirmish, the Consumer Financial Protection Bureau appeared to have been victorious. A judge agreed in September with the bureau that a financial company had misled more than 100,000 mortgage customers. As punishment, the judge ordered the Ohio company, Nationwide Biweekly Administration, to pay nearly $8 million in penalties. 
All that was left was to collect the cash. Last week, lawyers from the consumer bureau filed an 11-page brief asking the judge to force Nationwide to post an $8 million bond while the proceedings wrapped up. 
Then Mick Mulvaney was named the consumer bureau’s acting director. 
Barely 48 hours later, the same lawyers filed a new two-sentence brief. Their request: to withdraw their earlier submission and no longer take a position on whether Nationwide should put up the cash. 
It was a subtle but unmistakable sign that the consumer bureau under Mr. Mulvaney is headed in a new direction — one that takes a lighter touch to regulating the financial industry. The reversal is part of a broad push by the Trump administration to unfetter companies from Obama-era regulations.
Inside the agency, change has been swift. Mr. Mulvaney briefly stopped approval of payments to some victims of financial crime, halted hiring, froze all new rule-making and ordered a review of active investigations and lawsuits. Some, he has indicated, will be abandoned
“This place will be different, under my leadership and under whoever follows me,” Mr. Mulvaney said Monday about an agency that he previously denounced as a “sad, sick” example of bureaucracy gone amok. 
Mr. Mulvaney took over leadership of the bureau, created in the aftermath of the global financial crisis, less than two weeks ago. The abrupt resignation of Richard Cordray, the bureau’s longtime director, who had been appointed by President Barack Obama, set off an extraordinary public fight for control of the agency. The battle pitted Mr. Mulvaney, who was named acting director by President Trump, against Leandra English, the bureau’s deputy director under Mr. Cordray. While Mr. Trump can appoint his own director, confirmation could take months. Until then, the acting director is in charge. 
Last week, a federal judge ruled in Mr. Mulvaney’s favor, denying an emergency motion that Ms. English had filed to stop the White House from selecting a temporary director. The lawsuit is continuing. 
The bureau has been investigating Santander, the giant Spanish bank, for overcharging auto loan customers. Given the tenor of recent conversations inside the bureau, agency lawyers suspect the investigation could be shelved under Mr. Mulvaney, according to four people with knowledge of the case who requested anonymity to discuss an investigation. 
Raschelle Burton, a spokeswoman for Santander, said the company was not aware of any planned lawsuit from the C.F.P.B.

By the time the matter gets to the Supreme Court -- if they even bother to take it up -- Mulvaney will have long ended the agency's investigations and will have wrecked any hope of consumers getting their money back from the banks.

Mulvaney wasn't brought in to streamline the agency.  He was brought in to dismantle it.  And there's every reason to believe the GOP will find a way to eliminate the agency sooner rather than later.  Remember the Dubya days, where industry regulators were tasked to protect industries from lawsuits?  We're back to that with a vengeance.

But hey, this is what the country voted for, right?

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