Cordray: Say, what this CFPB needs is more power

Ed Morrissey

When Senate Republicans blocked the confirmation of Richard Cordray to run the Consumer Financial Protection Bureau, they did so in protest of the ambiguous and open-ended power granted to CFPB by the previous Democratic-controlled Congress.  Barack Obama blasted Republicans for obstructionism, defended Cordray as a mainstream, responsible choice to lead the CFPB, and gave him a recess appointment [see update below].  Now that he’s ensconced at the CFPB, Cordray’s first action is to demand even more power at CFPB, including new federal oversight on collection agencies:

The Consumer Financial Protection Bureau on Thursday sought to bring debt collectors and credit bureaus under its purview, marking the first time the often controversial industries would be subject to federal supervision.

Under its proposed rule, the CFPB would oversee the nation’s largest debt collectors, the primary credit reporting agencies such as Experian, Equifax and TransUnion, and other lesser-known consumer reporting agencies. It is the first attempt by the watchdog agency to define which businesses in the vast swath of nontraditional financial institutions will be subject to the same examination process as banks.

“This oversight would help restore confidence that the federal government is standing beside the American consumer,” CFPB Director Richard Cordray said in a statement.

There may be good reason to regulate debt collectors and so-called “fourth bureau” reporting agencies at the federal level.  If their businesses cross state lines, then federal jurisdiction would be easy to establish.  However, that kind of direction should come from Congress, not from unaccountable bureaucrats issuing “rules” to expand their bureaucratic fiefdoms…

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