More on the CFPB’s Jurisdiction

Recently, we've posted about the degree to which the Consumer Financial Protection Bureau (CFPB) should look out for the interests of the businesses it regulates (in a guest post by Rob Bramson) and the CFPB's assertion of jurisdiction over lawyers' activities in some situations (in a post noting the American Bar Association's opposition).

Now, in a guest post, CL&P Blog reader and consumer lawyer Nicole Mayer expresses her view:


The work of the Consumer Financial Protection
Bureau over the past few months has sparked complaints about its seemingly wide-spread
jurisdiction.  The complainants keep forgetting that this is the CONSUMER FINANCIAL
Protection Bureau.  What’s in a
name?  A lot!

One has to wonder if the same group of dissenters would find
it acceptable to limit other government agencies in the same manner they wish
to limit the CFPB.  Would they take issue
with a decree that the Department of Justice could carry out justice in no cases except those involving murder?  What would they
think about the Food and Drug Administration having authority to regulate food
but not drugs?  What if we took away the
Federal Communication Commission’s ability to oversee anything except radio
broadcasting?  Or, what would the reaction
be if the Bureau of Alcohol, Tobacco, Firearms and Explosives only had
authority to safeguard the public against tobacco?  You catch my drift. 

If government agencies did not have jurisdiction over the
fields their very name includes, we would find ourselves in need of a million
different agencies and would face a whole new host of complaints.  The issues taken on by the CFPB all focus on
protecting consumers in consumer financial transactions and are therefore,
legally within its purview. 

The gripe that the CFPB exemplifies "too
much government regulation,” when coming from those involved in big businesses
that provide products and services to consumers, strikes me as particularly
ironic given the self-fulfilling prophecy created by their own business
decisions.  Perhaps a valuable lesson can
be learned here to be careful what you wish for because you just might get it.

Many of the CFPB critics are the same people who hire teams
of lawyers to create iron clad consumer arbitration agreements and who celebrate
every time a court rules against a consumer in favor of the black hole of individual
consumer arbitration.  Despite their
claims that “the private sector does everything better,” these individuals’
actions indicate that they want
less private sector activity
, at least when it comes to court activity.   With the
private rights of action being stripped away from consumers and consumer
advocates, who else but the government has the ability to step up and regulate
consumer financial transactions?

Maybe one day the tides will change and arbitration will go
back to being a forum for business disputes. 
On that day, maybe consumers will no longer be denied access to
courts.  And, just maybe on that day, we won’t
need as much government regulation.  But
until then, I, for one, am glad the CFPB is on the beat and turning up the

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