U.S. Consumer Financial Protection Bureau

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U.S. Consumer Financial Protection Bureau
Founded July 21, 2011
Headquarters Washington, D.C.
Products Regulation
Twitter ID CFPB
Web site www.consumerfinance.gov

Established by Title X of the Dodd-Frank Act, the Consumer Financial Protection Bureau (CFPB) will conduct rule-making and enforcement of consumer financial protection laws, promote financial education and monitor financial markets that affect consumers. Many parts of the Dodd-Frank Act relating to the CFPB are planned to go into effect on July 21, 2011. Treasury Secretary Timothy Geithner is charged with creating the CFPB. On September 17, 2010, Elizabeth Warren was named Assistant to the President and Special Advisor to the Secretary of the Treasury on the CFPB. On July 17, 2011, Richard Cordray was nominated as Director of the CFPB, having formerly served as head of the enforcement division at the agency.[1][2]

Subsequent to the nomination of Cordray as head of the CFPB, Warren decided to leave the agency and return to her professorial duties at Harvard Law School. On August 1, 2011, the Treasury Department promoted Rajeev (Raj) Date as Special Advisor for the CFPB. [3]

On December 8, 2011, the nomination of Cordray as CFPB Director failed to receive enough votes to pass the U.S. Senate. The nomination was blocked by opponents of the CFPB and its power to regulate nonbank financial institutions. Without a confirmed director, the CFPB is incapable of carrying out its Dodd-Frank-related duties. [4] On January 4, 2012, President Barack Obama appointed Cordray as CFPB chairman in a "recess appointment. Senate Republicans condemned the appointment as "illegal," and promised to fight the appointment in court.[5]

Background

The centerpiece of Obama’s plan for the CFPB was to attempt to safeguard consumers against mortgage, credit card and other abuses that contributed to the credit crisis.[6]

In February of 2010, the Obama Administration backed away from creating a stand-alone Consumer Financial Protection Agency in its overhaul of Wall Street regulations, bowing to mounting pressure from lawmakers and industry. A White House official in a statement signaled a willingness to accept less than a separate agency. The statement outlined the powers legislation must provide for a consumer authority and dropped references to a separate agency to police banks for lending abuses.

On March 1, 2010, however, the head of the Federal Deposit Insurance Corp., Sheila Bair, pitched again for a new agency for consumer financial protection, saying that she believed the creation of such an agency would "help community banks, not hurt them."[7]

Video Overview

Proposed Organizational Structure

DraftOrgChartCFPB 2-3-20111.png

References

  1. Learn About the Bureau. CFPB. Retrieved on March 17, 2011.
  2. Obama’s Pick for Consumer Agency Has Record of Fighting Banks. Bloomberg. Retrieved on July 17, 2011.
  3. Treasury Department Announces Plans for Leadership Transition at the Consumer Financial Protection Bureau. U.S. Department of the Treasury. Retrieved on October 31, 2011.
  4. U.S. Senate Republicans Block Cordray for Consumer Bureau. Bloomberg Businessweek. Retrieved on December 8, 2011.
  5. Obama bypasses Senate, installs new consumer chief. Chicago Sun-Times. Retrieved on January 4, 2012.
  6. Barack Obama To Create Consumer Financial Protection Agency. Politico. Retrieved on March 1, 2010.
  7. Bair Pitching For Consumer Agency. Boston.com. Retrieved on March 1, 2010.

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