My Latest Op-ed: The Consumer Financial Protection Bureau, leaving the public high and dry

Here, in the Daily News. Excerpt: 

Mulvaney once called the bureau a "sad, sick joke" and co-sponsored a bill to eliminate it. The solution he has adopted to run an agency he thinks should not exist is to "be a good bureaucrat," and do what the law requires — but no more. Mulvaney even extends this strict-construction approach to congressional testimony: He explained that he did not have to answer questions from the members of Congress because the statute said he had to "appear" before them but said nothing about responding to their queries — though he did so.

A problem with this grudging approach is that no legislature can write statutes to prohibit all the ways businesses devise to take advantage of consumers. When the bureau, then led by Obama appointee Richard Cordray, fined Wells Fargo $100 million for opening millions of unauthorized accounts, it did not rely on a statute that said banks cannot open sham accounts, because there is no such statute. Instead, the bureau used the more general authority Congress had given it to punish banks for unfair and abusive practices.

But a Consumer Financial Protection Bureau that interprets those powers as applying only to Wells Fargo will not provide consumers needed protection against other financial institutions. And not even Wells Fargo would have to worry if the Republican-controlled House of Representatives gets its way on a bill it passed to do away with the bureau's power to sue financial institutions for unfair and abusive practices.

CORRECTION: As Jonathan Joshua has pointed out to me, 15 USC § 1642 prohibits the issuance of credit cards in the absence of a "request or application."  While Wells Fargo issued unauthorized credit cards, I'm not sure how many unauthorized credit cards it issued, and how many ordinary bank accounts it opened, though I have the impression that it opened many more bank accounts.  

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