[Congressional Record Volume 164, Number 58 (Wednesday, April 11, 2018)]
[House]
[Pages H3141-H3144]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




PROTECT AMERICAN CONSUMERS AND DEFEND THE CONSUMER FINANCIAL PROTECTION 
                                 BUREAU

  The SPEAKER pro tempore (Mr. Gaetz). Under the Speaker's announced 
policy of January 3, 2017, the Chair recognizes the gentlewoman from 
New York (Mrs. Carolyn B. Maloney) for 30 minutes.
  Mrs. CAROLYN B. MALONEY of New York. Mr. Speaker, thank you so much. 
We are here today to declare our strongest resolve and determination to 
protect American consumers and defend the Consumer Financial Protection 
Bureau.
  The Bureau is under assault by the current administration, the 
Republican administration, and we will do everything in our power to 
guard it and to protect it so that it can protect consumers.
  I am pleased to stand here with Democratic House members of the 
Financial Services Committee and of the Joint Economic Committee. I 
would like to thank Ranking Member Maxine Waters for her leadership and 
for working collaboratively with me to organize this important Special 
Order.

                              {time}  1915

  It is fitting that the Financial Services Committee Democrats lead 
efforts to protect the Consumer Financial Protection Bureau, because we 
created it in 2009 when we passed the landmark Wall Street Reform and 
Consumer Protection Act, known as Dodd-Frank for Senator Chris Dodd and 
our former colleague and chairman, Barney Frank.
  It is also fitting that Democratic House Members of the Joint 
Economic Committee participate because the attack on the CFPB not only 
hurts consumers, but harms businesses and our overall broader economy.
  Let's put things in historical perspective. During the last 2 years 
of the George W. Bush administration, we suffered what former Federal 
Reserve Chairman Bernanke called ``the worst financial crisis in global 
history, including the Great Depression.''
  The former Chair of the Joint Economic Committee for President Obama, 
Christina Roamer, said that the economic shocks during that period were 
five times greater than the Great Depression.
  In the last month of the Bush Presidency alone, our economy lost over 
800,000 private sector jobs. We were hemorrhaging 800,000 jobs a month. 
Nearly $13 trillion in household wealth was completely lost. Home 
values plunged, on average, by almost 20 percent. Millions of people 
lost their homes. And at the peak of the recession, unemployment 
reached 10 percent. African-American unemployment reached almost 17 
percent, and Latino unemployment was 13 percent.
  In short, millions of Americans lost their jobs and millions lost 
their homes. At the root of the economic crisis were bad mortgages sold 
to families that could not afford them, a lack of consumer protections 
to shield Americans from financial predators.
  No single government agency was dedicated to protecting consumers. 
They were dedicated to protecting banks and other financial 
institutions. But often consumer concerns was a secondary thought, a 
third thought, or not thought about at all.
  So Democrats wrote and passed into law the Wall Street Reform and 
Consumer Protection Act, and at the heart was the Consumer Financial 
Protection Bureau. Its sole purpose was to prevent this type of 
economic disaster and to protect consumers.
  Consumers want and need protection. The Federal Government sets and 
enforces safety standards on a wide variety of consumer goods. But 
until 2010, with the passage of the Wall Street Reform and Consumer 
Protection Act, there were few protections for consumers of financial 
products--and many, many abuses.
  Senator Elizabeth Warren, in her groundbreaking article, called for 
the creation of an agency dedicated solely to protecting consumers of 
financial products, pointed out the absurdity of not protecting 
consumers:
  ``It is impossible to buy a toaster that has a one-in-five chance of 
bursting into flames and burning down your house. But it is possible to 
refinance an existing home with a mortgage that has the same one-in-
five chance of putting the family out on the street. . . .''
  What is good enough for toasters and washing machines and cars, she 
argued, is good enough for mortgages. And it certainly would help our 
people. She was right. And that is a primary reason that we must defend 
the original mission of the CFPB today.
  Ranking Member Waters will describe some of the excellent work of the 
CFPB, which they have done to protect consumers.
  Three numbers bear pointing out: In the first 6 years, the CFPB 
handled more than 1.2 million complaints and has delivered almost $12 
billion--billion, as in B--in relief, and sent that money back to 
consumers for their use in their pockets and their homes, to nearly 30 
million consumers who had been harmed.
  My Republican colleagues call this ``regulatory overreach'' or 
government run amuck. They want the CFPB to be less aggressive. In 
other words, they don't want the CFPB there to protect

[[Page H3142]]

and help consumers. In fact, it is doing exactly what it is intended to 
do: protect ordinary Americans against financial predators.
  I dare opponents of the CFPB to inform those 30 million Americans who 
have received almost $12 billion in relief of their plans to weaken the 
agency. For those who want to neuter the CFPB and consumer protections, 
it is outrageous, it is wrong, and Democrats are going to fight this 
like you would never believe.
  I would like to draw your attention to one very important function of 
the CFPB: enforcing the Credit Cardholders' Bill of Rights, the CARD 
Act, which I am proud to have authored.
  The CARD Act prevents what were some of the worst abuses of the 
credit card industry. It used to be almost out of control. You couldn't 
walk on the floor or down the street without people coming up to you 
and telling you stories about credit card abuses.
  The bill was common sense. It cut out unfair, deceptive, 
anticompetitive actions by restricting fees. It protected consumers 
against retroactive rate increases on existing balances. In order to 
increase the rate, the consumer had to opt in and agree to an increased 
rate.
  What happened before is they would be told you can buy a car for 
$8,000 at a 6 percent interest rate. They would buy the car, then all 
of a sudden the rate was up to 20 percent, 30 percent, and consumers 
were caught in a never-ending cycle of debt.
  This bill requires the lenders to alert consumers of any rate 
increases, prevents double billing, and prevents lying. If you say your 
rate is one rate, then that is what the rate has to be. It prevents 
credit card companies from raising credit limits for people who can't 
repay the debt.
  In 2016, the CFPB report found that the CARD Act alone saved American 
consumers over $12 billion. That is 12 billion, as in B. I call it the 
Democratic stimulus plan because it kept the money in the consumers' 
hands and not in fees that were unfair.
  But it is not enough just for the CARD Act to exist. It also has to 
be enforced. Enforcement of existing laws has been a critical function 
of the CFPB.
  Few would deny that the CFPB has been ver effective. That is why I 
believe the opponents, the Republican majority and others, are 
attacking it.

  The Trump administration has launched an assault on the CFPB. 
President Trump illegally appointed a man to head the CFPB who once 
said that he wished it didn't exist. As a Member of Congress, he 
sponsored a bill to abolish it.
  Now, why would you put someone in charge of an agency who says they 
want to abolish it, unless you want to abolish it?
  This follows in the pattern of other appointments in this 
administration: putting people in charge of an agency that they 
fundamentally oppose.
  Now that Mick Mulvaney runs the CFPB, he is taking radical steps to 
make it ineffective. This means weakening consumer protections and 
restricting enforcement.
  We had a hearing today at the Financial Services Committee this 
morning, and I asked him how many enforcement actions he has taken 
since he has started as the Acting Director for 5 months? His answer 
was none, zero.
  Now, under the former Director, Richard Cordray, the Bureau took 
roughly 70 enforcement actions. They were bringing one roughly every 
week to protect consumers. But now, under Mulvaney, they are bringing 
absolutely none.
  Weakening the CFPB and loosening consumer protections will make tens 
of millions of American families vulnerable. But it will also affect 
the economy via an indirect route.
  A lack of effective protections will make it difficult for consumers 
to differentiate good products from bad. Reputable financial 
institutions that treat their consumers fairly--and there are many of 
them--will suffer with this uncertainty, and they will be incentivized 
to copy their disreputable competitors in a race to the bottom.
  In this way, weak consumer protections can slow economic growth. As 
it turns out, what is good for consumers is also good for the economy.
  We have other people who are here to speak, but I do want to say 
that, in some ways, at the heart of a financial crisis was a lack of 
consumer protection. Predatory lenders were able to sell bad mortgages. 
It was immensely profitable. They were what we called NINJA loans for 
people with no income, no job, and no assets.
  In New York, they used to say that, if you can't afford your rent, go 
out and buy a house; it is easy to do. They were handing out bad loans 
and then securitizing mortgages on the secondary market, which were 
destined to fail. And they bought insurance--default swaps--to 
supposedly eliminate risk, which, in fact, only made it riskier. A 
giant wave of mortgage defaults ignited the financial crisis, leading 
to the worst economic crisis since the Great Depression.
  Economists have said over and over again we could have saved our 
economy from this terrible $15 trillion loss of home values and home 
assets if we just had good management and protection of consumers. And 
it all began with a mountain of bad mortgages, many of them unfair and 
predatory. If the CFPB had existed at that time and if it had 
implemented current mortgage standards, we would not have had that 
financial crisis.
  So I would say Mick Mulvaney and other opponents of the CFPB should 
have learned a lesson from the catastrophic financial crisis that 
caused many Americans to lose their homes and their jobs, and we are 
still recovering.
  The philosopher, George Santayana, said that those who forget the 
past are destined to repeat it. So now the effort by the Republican 
majority to roll back the protections from the Wall Street Reform Act 
and to roll back the protections from the CFPB are increasing the 
probability of another catastrophe. We don't want that to happen, and 
that is why we defend Dodd-Frank, and that is why we will fight to 
oppose efforts, in any way, shape, or form, to weaken the CFPB.
  Why in the world would anyone want to weaken protections for working 
men and women?
  Now, one of the great leaders in this country for working men and 
women and for fair treatment under the laws of our country is the 
esteemed ranking member of the Financial Services Committee from the 
great State of California, Ms. Maxine Waters, a tireless advocate for 
consumers and the work of the CFPB. She has led Democrats on numerous 
efforts to maintain the structure, independence, and power of the 
Consumer Financial Protection Bureau so that it can continue working 
for you, working for the people, the American families, the consumers 
that we have in our country.
  Mr. Speaker, it is now my honor to yield to the gentlewoman from 
California (Ms. Maxine Waters), the distinguished ranking member.

                              {time}  1930

  Ms. MAXINE WATERS of California. Mr. Speaker, I thank Congresswoman 
Maloney for helping to make sure that we come to the floor this evening 
so that we can speak up for the Consumer Financial Protection Bureau.
  Mr. Speaker, I rise this evening, along with my Democratic colleagues 
on the Financial Services Committee, to discuss a central component of 
the Dodd-Frank Wall Street Reform and Consumer Protection Act, the 
Consumer Financial Protection Bureau.
  Mr. Speaker, I really want to thank my colleague, Mrs. Maloney, for 
organizing this event with me tonight. Mrs. Maloney is a valuable 
member of the Financial Services Committee and she is also a leader on 
the Joint Economic Committee, she serves on the Oversight and 
Government Reform Committee.
  She is a very, very busy Member of this Congress, and I don't know 
exactly how she finds time to do everything that she does, but I am so 
grateful for the opportunity to serve with her, because of her 
dedication and her commitment, not only to her constituents, but to the 
citizens of this country, and particularly focused on consumer 
protection.
  The Consumer Bureau is vitally important in protecting American 
consumers from unfair, deceptive, or abusive practices by financial 
institutions all across the country.
  Following the financial crisis, Congress created the Consumer Bureau 
in order to ensure that Americans have a regulator solely focused on 
ensuring that they are not preyed on by bad actors. The need for such 
an agency was

[[Page H3143]]

made very clear by the 2008 crisis, which was driven by unchecked, 
deceptive, predatory lending that caused millions of American families 
to lose their homes.
  The Consumer Bureau has been an enormous success, and under the 
leadership of Richard Cordray, the agency worked exactly as we intended 
it to. The Consumer Bureau has returned nearly $12 billion to over 30 
million consumers who have been harmed by financial institutions. The 
agency has also addressed more than 1.2 million consumer complaints 
about financial institutions.
  But now Donald Trump has moved to ``do a big number on Dodd-Frank'' 
and undermine the Consumer Bureau. Despite the fact that the Dodd-Frank 
statute is very clear that the deputy director of the Consumer Bureau 
shall serve as acting director in the absence or unavailability of the 
director, President Trump illegally appointed his Office of Management 
and Budget Director, Mick Mulvaney, to serve as acting director. 
Because Mr. Mulvaney serves at the pleasure of the President as OMB 
Director, President Trump now has an inappropriate level of influence 
over the operations and activities of the Consumer Bureau, which is an 
independent agency that is supposed to be outside of the authority of 
the executive branch.
  Since his illegal appointment, Mr. Mulvaney has indeed been carrying 
out President Trump's harmful agenda and working to reverse much of the 
important progress that the agency has made. This is not surprising 
given that Mulvaney previously stated, ``I don't like the fact that the 
CFPB exists,'' and even called the Consumer Bureau a sick, sad joke.
  In his short time at the Consumer Bureau, Mr. Mulvaney has stripped 
the Office of Fair Lending and Equal Opportunity of its enforcement and 
supervisory powers, in a move that badly weakens the agency's ability 
to crack down on discriminatory lending. He has also taken zero public 
enforcement actions against financial institutions that harm consumers 
across the board during his tenure, even though his predecessor, 
Richard Cordray, initiated hundreds.
  In addition, Mr. Mulvaney has taken a series of actions that benefit 
predatory payday lenders, including the decision to halt implementation 
of the Consumer Bureau's sensible payday rule, the decision to withdraw 
a lawsuit against a group of payday lenders that allegedly misled 
consumers about the cost of loans, which had interest rates as high as 
950 percent a year, and the decision to cease an investigation into 
World Acceptance Corporation, a high-cost installment lender which was 
reportedly engaging in abusive practices. And, in fact, the former CEO 
of World Acceptance Corporation felt so comfortable with Mr. Mulvaney, 
that she had the audacity to send to him a letter requesting that she 
be appointed to run the whole agency as the director.
  So many of us were shocked at the audacity that she exhibited, and 
tried to find out from Mr. Mulvaney today, I did in particular, why did 
he halt the lawsuit against her company and why would she send him her 
resume to ask to be considered for the role of director of the Consumer 
Bureau.
  Mr. Mulvaney's many harmful actions send a signal to bad actors that 
they can get away with abusing consumers.
  What is more, Republicans have relentlessly attacked the Consumer 
Bureau since its inception. Despite what my Republican colleagues may 
have you believe, the leadership structure of the Consumer Bureau is 
not unique. In fact, there are other Federal regulatory agencies with 
similar structures, but these facts haven't stopped Republicans and 
some in the industry from making legal challenges to its structure. 
That is why last year, I led 40 other current and former Members of 
Congress to file a brief with the D.C. Circuit Court of Appeals in the 
P.H.H. case support of the Consumer Bureau's independent structure and 
its clear constitutionality. And earlier this year, the court issued a 
decision upholding the constitutionality of the Consumer Bureau's 
structure.
  Republicans have been clamoring to weaken, impede, and ultimately 
destroy the Consumer Bureau since its creation. First, they did 
everything they could to block a director from being appointed in the 
first place, and since then, they have pushed measures to defund and 
dismantle the Consumer Bureau. The chairman has called for the Consumer 
Bureau to be ``functionally terminated,'' and advanced legislation, 
including H.R. 10, which I call the ``Wrong'' CHOICE Act, to do so.
  Now, in Mick Mulvaney, Republicans have an ally to destroy the 
Consumer Bureau from within, but it is unclear why destroying the 
Consumer Bureau is at the top of the Republican agenda.

  There are constituents in every State who have been ripped off by 
financial institutions. Why aren't Republicans fighting for them and 
for their financial security?
  Mr. Speaker, Democrats will not allow the Consumer Bureau to be 
diverted from its statutorily mandated mission of protecting consumers 
and serving as an independent watchdog.
  This agency is crucial for hardworking Americans, and its work must 
continue.
  Mr. Speaker, in my closing, I would like to thank Congresswoman 
Maloney for the way that she conducted her questions today with Mr. 
Mulvaney in our committee and asked him how many cases had he taken up, 
what had he initiated against those companies that are committing 
fraud, only to find out that he has done nothing. She forced him to 
answer, and he had to admit, zero, that he has not taken any actions 
against any companies in this country who are involved in the kind of 
actions that the Consumer Bureau is designed to deal with and to force 
them to do the right thing.
  So, Mr. Speaker, in that, I would like to thank Congresswoman Maloney 
for initiating this action this evening that we are taking to make sure 
everyone understands the importance of the Consumer Financial 
Protection Bureau, and I appreciate working with her to get this done.
  Mrs. CAROLYN B. MALONEY of New York. Mr. Speaker, I thank the 
gentlewoman for her statement tonight and for her leadership.
  Mr. Speaker, I yield to the gentleman from the great State of Nevada 
(Mr. Kihuen), and we welcome him.
  Mr. KIHUEN. Mr. Speaker, I thank Representative Maloney and Ranking 
Member Waters for providing me this opportunity to speak about the 
critical importance of the Consumer Financial Protection Bureau, the 
CFPB.
  Mr. Speaker, during the recession, Nevada was ground zero for the 
housing crisis.
  For 5 years, Nevada led the Nation in foreclosures. In 2010, 70 
percent of Nevada homeowners were underwater on their homes. I saw 
firsthand as family, friends, neighbors, and constituents who lost 
their homes because of big banks and unscrupulous mortgage lenders.
  While Nevada has made a tremendous recovery since the recession, the 
scars are deep and still fresh.
  In the wake of the financial crisis, the CFPB was created to protect 
Americans from unfair, deceptive, or abusive practices that led to the 
financial crisis, and to take action against companies that break the 
law.
  The CFPB has cracked down on predatory lenders and aggressive debt 
collectors, and forced financial institutions to return over $11 
billion to Americans who have been taken advantage of.
  Since 2011, the agency has been a resource for thousands of my 
constituents. More than 14,000 Nevadans have gone to the CFPB with 
complaints, and over 3,400 of them about mortgages.
  It is appalling that Mr. Mulvaney and congressional Republicans are 
focused on destroying the CFPB at the expense of American families.
  When someone has an unwarranted overdraft, an incorrect credit score, 
or is misled by their bank, they turn to the CFPB for help.
  I will do everything I can to ensure that Nevadans never again have 
to experience the pain of being foreclosed on or being preyed upon by 
unscrupulous lenders.
  The cost to consumers is not only their livelihoods, but the future 
of our economy, because a strong economy includes a strong consumer.
  Mrs. CAROLYN B. MALONEY of New York. Mr. Speaker, I thank the 
gentleman for his really heartfelt report to us on how it affected his 
constituents.

[[Page H3144]]

  Mr. Speaker, I include in the Record an article in Roll Call on the 
importance of the CFPB, and also the actions that the Consumer 
Financial Protection Bureau has taken by the numbers to help people in 
our country.

         Mulvaney's Attacks on CFPB Hurt Consumers and Economy

                       (By Rep. Carolyn Maloney)

       As a congressman, Mick Mulvaney once co-sponsored a bill to 
     abolish the Consumer Financial Protection Bureau. And since 
     being appointed by President Donald Trump to temporarily lead 
     the agency, he has worked to cripple it from the inside.
       What he is doing will hurt consumers not once but twice--
     first, by letting off the hook financial institutions that 
     take advantage of their customers, and second, by giving 
     other companies large incentives to do the same.
       In its first six years, the CFPB has handled more than 1.2 
     million complaints and delivered almost $12 billion in relief 
     to nearly 30 million consumers. It has put in place new 
     protections against payday lending, investigated predatory 
     payday lenders, fought mortgage servicers for wrongful 
     foreclosures, established new mortgage standards to protect 
     homebuyers, and required lenders to verify that borrowers 
     have the means to repay their loans. It also banned financial 
     institutions from using arbitration clauses to deny consumers 
     the right to sue, took action against companies for illegal 
     collection of student loan debt, ordered Wells Fargo to pay 
     full restitution to customers for opening accounts without 
     their consent, enforced the Credit Cardholders' Bill of 
     Rights, published a public database of consumer complaints, 
     and established extensive educational materials on financial 
     products for consumers.
       Sen. Elizabeth Warren, D-Mass., who was the driving force 
     behind the CFPB's creation, has pointed out that we shouldn't 
     put people in charge of agencies they want to destroy. That 
     seems self-evident--unless the specific goal is to destroy 
     it.
       Soon after his appointment, Mulvaney began weakening and 
     radically changing the CFPB, stating that part of the 
     agency's new core mission statement would be to deregulate 
     financial products by ``regularly identifying and addressing 
     outdated, unnecessary or unduly burdensome regulations.''
       He has zealously pursued this new mission by putting a 
     freeze on the implementation of all new rules, delaying long-
     planned rules to protect users of prepaid cards, halting the 
     agency's investigation of Equifax for failing to protect 
     customers' private information, weakening rules against 
     predatory payday lenders, and pulling the plug on a suit 
     against payday lenders that charged annualized interest rates 
     of up to 950 percent. Mulvaney is trying to politicize the 
     agency by placing political appointees in positions normally 
     staffed by nonpartisan civil servants. He also tried to 
     starve the agency by requesting zero operating funds for the 
     second quarter of fiscal 2018.
       The rollbacks won't just hurt consumers, they will also 
     hurt our economy. Fair regulations that protect consumers are 
     essential for well-functioning markets. Without effective 
     rules, we've seen that some companies will cheat their 
     customers. As word spreads, millions of consumers are forced 
     to question whether products are safe or secure. This 
     uncertainty leads them to buy less. Many businesses--even 
     those that treat their customers fairly--lose sales. The 
     economy suffers.
       One would think that deregulators like Mulvaney would have 
     learned a lesson from the 2007-2008 financial meltdown, which 
     threw our economy into a devastating recession. At the root 
     of the crisis were the many lenders who convinced American 
     consumers to purchase mortgages they could not afford, 
     including the infamous NINJA loans to those with ``no income, 
     no job and no assets.'' At first, companies that sold these 
     predatory loans were on the outskirts of the industry, but 
     when regulators failed to step in to protect consumers, many 
     reputable companies that feared being left off the gravy 
     train jumped in.
       The mountain of subprime mortgages, sold and repackaged as 
     securities presumably to eliminate risk, turned out to be a 
     house of cards, resulting in what former Federal Reserve 
     Chairman Ben Bernanke called ``the worst financial crisis in 
     global history, including the Great Depression.'' Millions of 
     Americans lost their jobs or their homes. It took nine years 
     for the economy to fully recover.
       Fair regulations that are enforced rigorously are critical 
     not only to protect consumers, but because they are essential 
     for markets to work efficiently. Deliberate efforts to 
     undermine the CFPB will not only prove to be a raw deal for 
     millions of Americans but can cause lasting damage to our 
     economy.
                                  ____


          Consumer Financial Protection Bureau: By the Numbers

       $11.9 billion: Approximate amount of ordered relief to 
     consumers from CFPB supervisory and enforcement work, 
     including:
       Approximately $3.8 billion in monetary compensation ordered 
     to be returned consumers as a result of enforcement activity
       Approximately $7.7 billion in principal reductions, 
     cancelled debts, and other consumer relief ordered as a 
     result of enforcement activity
       $398 million in consumer relief as a result of supervisory 
     activity
       29 million: Consumers who will receive relief as a result 
     of CFPB supervisory and enforcement work
       $600 million+: Money collected in civil monetary penalties 
     as a result of CFPB enforcement work
       1,242,800+: Complaints CFPB has handled as of July 1, 2017
       13 million: Unique visitors to Ask CFPB
       10.5 million: Mortgages consumers closed on after consumers 
     received the CFPB's Know Before You Owe disclosures
       147: Banks and credit unions under the CFPB's supervisory 
     authority as of April 1, 2017
       12 million: Consumers who are takeout payday loans each 
     year; the CFPB has proposed rules to put an end to payday 
     debt traps
       70 million: Consumers who are contacted about debts in 
     collection during the year; the CFPB is developing proposed 
     rules to protect consumers from harmful collection practices
       3,270+: Colleges voluntarily adopting the CFPB and Dept. of 
     Ed Financial Aid Shopping Sheet
       169: Visits to military installations by the Office of 
     Servicemember Affairs since 2011
       63: Times senior CFPB officials have testified before 
     Congress

  Mrs. CAROLYN B. MALONEY of New York. Mr. Speaker, I want to thank all 
of the hardworking people at the CFPB and those who worked to create 
it, and I thank my colleagues and friends for joining me tonight on 
this Special Order.
  Mr. Speaker, I yield back the balance of my time.

                          ____________________