On February 6th, the Chairman of the House Financial Services Committee, Rep. Jeb Hensarling (R- TX), shared a memorandum to his leadership team outlining his vision on restructuring the Dodd-Frank Act, including subjecting the Consumer Financial Protection Bureau (CFPB) to congressional appropriations and limiting the agency to enforcement authority. This varies slightly from his original restructuring of Dodd-Frank through legislation he proposed called the CHOICE Act during last session.

Chairman Hensarling favors a sole director, removable by the President at-will, which is different than the originally proposed bipartisan 5-member commission similar to the FCC and FTC.

Further, he proposes a restructuring of the CFPB as a “civil law enforcement agency” similar to FTC. This seems to indicate the intent to eliminate authority to supervise banks and nonbanks and roll back its rulemaking power and limit enforcement.

In Hensarling’s proposed restructuring, the CFPB would function as an enforcement agency for the nearly 20 federal consumer protection laws currently in existence. The CFPB’s preferred enforcement mechanisms are UDAAPs, which stands for Unfair, Deceptive, or Abusive Acts and Practices, as defined by the Dodd-Frank Act of 2010, and are deemed illegal. In eliminating the CFPB’s rulemaking authority, the agency would look to Congress to define and develop the laws needed to ensure consumer financial products are safe, fair, and reasonable.The agency’s enforcement authority would be limited to cease and desist and civil investigative demands.

President Trump has not revealed specific details on the proposed changes, but NAFSA will be monitoring this bill very closely.

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