FOR IMMEDIATE RELEASE
February 8, 2012
ABA Media Contact: Jeff Sigmund
(202) 663-5439
E-mail: jsigmund@aba.com
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ABA TESTIFIES ON NEED TO INCREASE ACCOUNTABILITY AT CFPB

WASHINGTON – The American Bankers Association testified today before the House Subcommittee on Financial Institutions and Consumer Credit, addressing measures that would increase accountability at the Consumer Financial Protection Bureau and ensure privileged information will not be unintentionally disclosed.

ABA Chief Operating Officer Michael J. Hunter testified on several key pieces of legislation that relate to the Bureau’s role and its exercise of power. 

“The Bureau will play a pivotal role in setting new rules that will affect access and availability of consumer financial products,” Hunter said.  “We strongly support an effective mechanism of checks and balances for the Bureau, and we applaud congressional efforts to achieve this goal.”

Hunter testified that H.R. 1355 would move the Bureau under Treasury, subjecting it to the appropriations process to ensure allocated funds are used effectively.  He noted two key questions:  how to assure accountability of decisions and appropriate limits on the Bureau’s power, and how to assure that the Bureau’s use of funds, whether provided by its current source -- the Federal Reserve -- or through appropriations, are used effectively and disclosed fully.

Hunter testified that there are many ways to increase accountability.  ABA has long advocated the use of a commission or board structure to accomplish this goal.  Legislation to create a five-member board for the Bureau was approved by the House last year.

“We believe such a structural change would provide an effective check and balance,” Hunter said.  “As the law is currently written, the Bureau’s director has sole authority to decide the direction and parameters of the consumer financial product market.  This vests far too much power in one person to fundamentally alter the financial choices available to customers.” 

Hunter also testified on the critical need for banking industry representation on the FDIC board.

“Banks bear the full cost of the FDIC without any taxpayer assistance, yet have no voice in the priorities, policies, and staffing of the agency,” Hunter said.  “We would be happy to work with the subcommittee on how this might be accomplished.”

Hunter closed his testimony by examining H.R. 3871, legislation intended to clarify the protection of confidential information for the Bureau.

“While the Bureau has expressed its willingness to address this issue through regulation, ABA believes it is appropriate to add certainty by enacting the same, express rules regarding privilege of information for the Bureau as those already established for other federal banking supervisors,” Hunter said.

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For a copy of Hunter’s full testimony, please click here.

About American Bankers Association 
The American Bankers Association represents banks of all sizes and charters and is the voice for the nation’s $13 trillion banking industry and its two million employees. The majority of ABA’s members are banks with less than $165 million in assets. Learn more at aba.com.