Richard Cordray, director of the Consumer Financial Protection Bureau, faced renewed questions yesterday about the legitimacy of his agency, the Washington Post reported today. Cordray, in a semiannual report to the Senate Banking Committee, touted the bureau’s accomplishments in drafting rules to fix mortgage servicing and supervising the previously unregulated non-bank financial firms. He added that the bureau is working on rules to bring greater transparency to prepaid debit cards and is fine-tuning its consumer complaint database. As of Sept. 3, the agency had received 72,297 complaints about mortgages, student loans and credit cards. But the remarks did little to satisfy Senate Republicans, who worried that the agency’s authority could lead to a reinterpretation of established federal laws. Several GOP-sponsored bills aimed at stripping the federal consumer watchdog of its authority are sitting in House and Senate committees, though none has much chance of becoming law this year. Republicans want the agency to go through Congress for funding, rather than the Federal Reserve, and to be run by a five-member commission rather than a single director. Sen. Richard C. Shelby (R-Ala.) said that he was troubled that the bureau could potentially create exceptions to a Wall Street reform law that would ban lenders from charging consumers upfront payment of fees when they take out a mortgage.
