(Reuters) – The U.S. Consumer Financial Protection Bureau (CFPB) has been thrown into disarray by a battle between the White House and Obama-era officials over who gets to run the federal watchdog on an interim basis after its director resigned.
Outgoing director Richard Cordray elevated an agency official to replace him on an interim basis. But Republican President Donald Trump then named his budget chief, Mick Mulvaney, as acting director until the president names a permanent successor who is confirmed by the Senate, which could take months.
Here are some facts about the CFPB.
The CFPB’s creation
The CFPB was created in 2011 under Democratic former President Barack Obama in the aftermath of the 2008 financial crisis to look out for the interests of ordinary borrowers. Prior to the enactment of the Dodd Frank Act, which created the CFPB, consumer financial protection was spread across seven federal agencies. None of them prioritized the consumer, which critics said allowed predatory and deceptive mortgage practices to flourish, fueling the crisis.
The agency’s duties
Wall Street accuses the agency of imposing overly burdensome regulations and large fines.
The agency during the Trump administration
The Republican-led Congress and White House have put a halt to rule-making by the CFPB. The Trump administration is focused on rolling back Obama-era financial rules. Trump this month signed a congressional resolution that lets banks, credit card companies and other financial firms block customers from filing class action lawsuits. The move killed a CFPB rule released in July.
CFPB restrictions on payday lenders, also known as “small-dollar” lending, are seen as the potential next target for Republicans. The CFPB’s power now is concentrated on enforcement, but that power may also be blunted.
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