On Thursday, the Consumer Finacial Protection Bureau (CFPB) revealed the membership of its newly-created taskforce assigned with reviewing current federal consumer finance laws and regulations. The taskforce will report recommendations for improving and strengthening the same to Director Kathleen Kraninger.
The CFPB selected Todd Zywicki to chair the taskforce. Zywicki is a professor at George Mason Univesity Antonin Scalia Law School, a Senior Fellow of the Cato Insitute, and the former Executive Director of George Mason University's Law and Economics Center. Zywicki was also regarded as a contender for the permanent director position at the CFPB after Former Director Richard Cordray stepped down. The role ultimately went to Kraninger.
CEI has long called for the CFPB to create such a task force to fix government regulations that impede access to credit, and Professor Zywicki is ideally suited to head these efforts. The creation of this task force demonstrates yet another way the Bureau, under the leadership of Kathleen Kraninger, is becoming less of an unwarranted menace to financial institutions and more pro-consumer.
Joining Zywicki on the task force are Dr. J. Howard Beales, III, Dr. Thomas Durkin, and L. Jean Noonan. Beales is a former professor at George Washington University and former director of the Bureau of Consumer Protection at the Federal Trade Commission (FTC). Durkin is a retired economist with the Federal Reserve Board. Noonan is a partner at the law firm Hudson Cook, former General Counsel at the Farm Credit Administration, and former Associate Director fo the FTC's Bureau of Consumer Protection's Credit Practice.
Director Kraninger states:
The Taskforce will conduct a thorough examination of our current regulatory framework and report on how we can improve federal consumer financial laws to benefit and protect consumers. I look forward to the work the Taskforce will undertake and reviewing their recommendations.
The CFPB first announced the taskforce in October 2019, where it sought applications from persons with significant experience and professional recognition in consumer protection, markets, laws, and regulations.
The CFPB's regulatory spectrum might seem narrow—consumer finance—but the reach is quite broad. There are myriad laws and regulations that govern this segment of the financial industry, and not all of them jive well with each other. An example relevant to the debt collection industry is whether or not the CFPB has the authority to regulate the collection of healthcare debt. At one point, the CFPB implied that it did, but its proposed debt collection rules seem to imply otherwise. (See Consumer Relations Consortium comment to the debt collection NPRM, pp. 4-6.) If an example exists in the niche industry of debt collection, there are likely many more examples in the broader industry of consumer financial services. Charging a taskforce to review all relevant laws and regulations as a whole will help pinpoint gaps, which is the first step toward finding solutions.