Written By ESR News Blog Editor Thomas Ahearn
In April 2018, the Consumer Financial Protection Bureau (CFPB) – the United States government agency responsible for consumer protection in the financial sector – presented the CFPB’s Semi-Annual Report to Congress for the period beginning on April 1, 2017, and ending on September 30, 2017.
In an introductory message to the report, CFPB Acting Director Mick Mulvaney wrote that “the Bureau is far too powerful, and with precious little oversight of its activities.” Mulvaney also requested that Congress make four changes to the law to establish meaningful accountability for the CFPB:
- Fund the CFPB through Congressional appropriations;
- Require legislative approval of major CFPB rules;
- Ensure that the Director answers to the President in the exercise of executive authority; and
- Create an independent Inspector General for the CFPB.
The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 – which the CFPB was created under in the aftermath of the financial crisis of 2007-2008 – “contemplates that the Director will submit independent legislative recommendations to Congress,” Mulvaney wrote in the report.
In November 2017, ESR News reported that U.S. President Donald Trump had designated Mulvaney – who also serves as the Director of the Office of Management and Budget (OMB) – as Acting Director of the CFPB after the resignation of former CFPB Director Richard Cordray, the only person to hold that job.
In January 2018, ESR News reported that Mulvaney sent a memo to employees informing them the CFPB would continue to fulfill its legal mandate to enforce consumer protection laws while also redirecting its mission and focus under new leadership. Mulvaney wrote that the CFPB had a new “mission”:
(W)e will exercise, with humility and prudence, the almost unparalleled power given to us to faithfully enforce the law in furtherance of the mandate given to us by Congress. But we go no further. Simply put, the days of aggressively “pushing the envelope” of the law in the name of the “mission” are over.
Mulvaney wrote the CFPB will focus on “quantifiable and unavoidable harm to the consumer” and not “go looking for excuses to bring lawsuits.” The CFPB will also prioritize complaints and “consider the potential costs and benefits to consumers and covered persons” required by the Dodd Frank Act.
Since 2013, the CFPB has been responsible for two forms mandated by the Fair Credit Reporting Act (FCRA) for compliance during employment background checks: A Summary of Your Rights Under the Fair Credit Reporting Act and Notice to Users of Consumer Reports: Obligations of Users Under the FCRA.
“Among other roles, the CPFB has rule making and enforcement powers over the FCRA while the Federal Trade Commission has the power to protect consumers from deceptive trade practice under the FCRA,” explained Attorney Lester Rosen, founder and CEO of Employment Screening Resources® (ESR).
“Neither employers nor background screening firms should assume from this new direction that legal compliance with the FCRA is any less critical,” Rosen said. “It remains to be seen what this new CFPB policy means, but this is another example of why legal compliance is a critical element of background screening.”
More Information about the CFPB
Employment Screening Resources® (ESR) is a leading global background check firm that is accredited by the National Association of Professional Background Screeners (NAPBS®). To learn more about ESR, visit www.esrcheck.com. For more blogs about the CFPB, visit www.esrcheck.com/wordpress/tag/cfpb/.
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