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Ted Cruz wants to abolish the Consumer Protection Bureau

This news story was published on July 21, 2015.
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Ted Cruz

Ted Cruz

WASHINGTON, D.C. – On the fourth anniversary of the creation of the Consumer Financial Protection Bureau (CFPB), U.S. Sen. Ted Cruz (R-Texas) and Rep. John Ratcliffe (R-Texas) have introduced legislation to eliminate it. The CFPB, like the Dodd-Frank legislation which created it, is just another example of the cronyism that infects our nation’s capital. The CFPB was sold as an entity to help consumers by regulating and reining in larger financial institutions. Ironically, the Bureau has had the opposite effect. Now five years after Dodd-Frank’s passage, big banks have only gotten bigger and the number of smaller banks and options for consumers have only decreased.

“Don’t let the name fool you, the Consumer Financial Protection Bureau does little to protect consumers. The agency continues to grow in power and magnitude without any accountability to Congress and the people. The only way to stop this runaway agency is by eliminating it altogether,” Sen. Cruz stated. “The legislation that Rep. Ratcliffe and I are introducing today gives Congress the opportunity to free consumers and small businesses from the CFPB’s regulatory blockades and financial activism, which stunt economic growth. While there’s much more to do to scale back the harmful regulatory impositions of Dodd-Frank, this legislation takes a critical step in the right direction. So today let’s celebrate the CFPB’s fourth and final anniversary,” Sen. Cruz concluded.

“The CFPB’s regulatory zeal has stripped American consumers and businesses of their freedom of choice and has limited their access to capital – all in the name of a ‘we know best’ attitude from Washington. It seems like every time I go home to Texas and spend time with people across our district, I hear stories about community banks having to choose between closing their doors or consolidating into larger institutions to handle the increase in compliance costs,” said Rep. Ratcliffe.

“I hear from businesses forced to spend more time on unnecessary regulatory compliance paperwork than helping serve their customers, and financial institutions that have stopped providing certain basic financial services out of fear of retaliation from the CFPB. I’m grateful to be able to introduce this bill with 46 of my House colleagues in conjunction with Senator Cruz. The CFPB represents exactly what President Reagan warned of – a government smothering opportunity rather than fostering it. We must eliminate the CFPB,” Rep. Ratcliffe added.

“The unelected bureaucrats at the CFPB’s helm are wholly unaccountable to the American people. Unlike most federal agencies, Congress does not oversee the CFPB through the annual appropriations process. The agency receives more than $600 million annually from the budget of the Federal Reserve System – monies that Congress does not control. This unique setup makes the CFPB one of the least accountable regulatory agencies in the federal government; a situation that invites regulatory excess and abuse.”

The Consumer Financial Protection Bureau was created after the crisis of 2008 to bring basic standards of fairness and transparency to the consumer financial marketplace, including credit cards, mortgages, student loans, auto loans, checking accounts, and debt collection. In the Bureau’s own words, its job is to make sure that “consumers get the information they need to make the financial decisions they believe are best for themselves and their families – that prices are clear up front, that risks are visible, and that nothing is buried in fine print.”

Today, for example, Consumer Financial Protection Bureau said it is ordering Citibank to refund $700 million for unfair and deceptive credit card practices.

“You might be eligible for a refund if you paid for credit and identity monitoring, credit protection products, or an expedited payment fee,” the agency said.

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