The nation’s acting consumer financial watchdog delivered some good news and lobbying advice this week to the bankers he regulates: He would like to cut off public access to a database of consumer complaints and suggested the industry donate to lawmakers to convince them to weaken his agency’s authority.
The comments by Mick Mulvaney, in a speech to a banking trade group, infuriated Democrats and consumer advocates who have complained that President Trump’s handpicked chief of the Consumer Financial Protection Bureau is serving the industry instead of average Americans.
In a speech to the American Bankers Assn., Mulvaney indicated he would eliminate the public’s ability to see the bureau’s extensive online database of complaints about credit cards and other financial products, a move industry executives have advocated.
Mulvaney also said he’s siding with them on legislative steps to reduce the watchdog agency’s authority. And when it comes to lobbying members of Congress to make such changes, Mulvaney recalled how he used to grant access when he was a Republican House member.
“We had a hierarchy in my office, in Congress. If you were a lobbyist who never gave us money, I didn’t talk to you,” the former South Carolina representative said at the banking group’s government relations summit Tuesday, according to a transcript provided by the bureau.
“If you were a lobbyist who gave us money, I might talk to you,” he said. “If you came from back home and sat in my lobby, I talk to you without exception, regardless of the financial contributions.”
Mulvaney went on to remind the bankers that lawmakers were juggling a lot of issues and needed to hear from them because “they will never know as much about your issues as you do.”
“And I don’t even know what you’re going to go tell them, and you may be completely on the other end of the political ideology from me, and I don’t care,” he concluded after noting he has formally urged lawmakers to reduce the independent bureau’s power.
Mulvaney wants to subject the bureau’s funding to the congressional appropriations process, require lawmakers’ approval for any new rules and give the president the power to dismiss the director for any reason.
Mulvaney’s comments drew outrage from Democrats and consumer advocates, who already have opposed his temporary leadership of the agency given his long opposition to its establishment following the financial crisis.
Sen. Bob Casey (D-Penn.) called Mulvaney “a disgrace.” Josh Stein, the Democratic attorney general of North Carolina, said Mulvaney has “gone too far.”
And Sen. Sherrod Brown (D-Ohio) called on Mulvaney to resign.
“Deciding who you will meet with based on campaign contributions is the kind of ‘pay to play’ that understandably makes Americans furious with Washington, D.C.,” Brown said. “Banks and payday lenders already have armies of lobbyists on their sides — they don’t need one more.”
Watchdog group Public Citizen echoed the call for Mulvaney to go. And another watchdog organization, Allied Progress, said Mulvaney should release a list of all his meetings as a congressman and as acting bureau director.
“When you tell a room full of big bankers and their lobbyists that you gave more access to lobbyists who gave you more money and that they should continue putting pressure on Congress, it doesn’t take a rocket scientist to deduce what you are telling them to do,” said Karl Frisch, executive director of Allied Progress.
A bureau spokesman said Mulvaney had no further comments on his speech.
Trump appointed Mulvaney, who also serves as White House budget director, to be the bureau’s acting chief in November in a controversial move that is being legally challenged. Since then, he’s scaled back the aggressive enforcement efforts that had been the hallmark of former director Richard Cordray, a Democrat, and publicly declared the bureau no longer would “push the envelope” to protect consumers.
His overhaul efforts have been wide-ranging. And on Tuesday, Mulvaney confirmed that he was even changing the formal name of the agency, as The Times reported he was considering.
Mulvaney said the 2010 Dodd-Frank law that created the agency refers to it as the Bureau of Consumer Financial Protection. And that’s the name that he has started using, including putting it on the agency’s first official seal.
“There is no such thing as the Consumer Financial Protection Bureau,” he said of the commonly known name that has been used since the Dodd-Frank Act was being considered in Congress.
“I’m not sure who made the decision [to use that name]. I think I can guess. She might be in the Senate,” he said in reference to Sen. Elizabeth Warren (D-Mass.), who helped launch the bureau as an aide to former President Obama.
Consumer advocates fear the change is designed to undermine the bureau by making it sound more bureaucratic and de-emphasizing the word “consumer.” Mulvaney is known for being outspoken. In a 2014 interview, he called the bureau a ”joke … in a sad, sick kind of way.”
And at his first congressional hearing as the bureau’s acting director this month — in a stunt meant to highlight what he considers the agency’s unconstitutional independence — he told lawmakers he could “just sit here and twiddle my thumbs” because Dodd-Frank only mandates that he appear before Congress, not answer any questions.
Mulvaney told the bankers group Tuesday that he would follow the letter of the law and go no further.
“So long as this thing exists, we’re going to try and give the very best service that we can and enforce the law as best we possibly can,” he said.
Mulvaney noted that while Dodd-Frank mandates the bureau create a database of consumer complaints about credit cards, mortgages and other financial products, the law doesn’t say anything about giving the public access to it.
Cordray made the complaint database public in 2012 to improve transparency. The Consumer Product Safety Commission, the National Highway Traffic Safety Administration and the Department of Transportation also have searchable public databases of complaints.
Even though banks are given 15 days to respond to any complaints first, financial industry executives have criticized the consumer bureau database, saying it contains unverified complaints and is misleading. Mulvaney appeared to side with them on the issue.
“I don’t see anything in here that I have to run a Yelp for financial services sponsored by the federal government,” he said. “I don’t see anything in here that says that I have to make all of those public.”
Richard Hunt, president of the Consumer Bankers Assn., cheered the idea of shutting down public access to the database.
“We fully support the bureau fulfilling its important, congressionally mandated mission,” he said. “Compiling complaints is part of that, but publishing unverified complaints — or worse, using those complaints to paint a picture of guilt in the public domain — is irresponsible.”
But consumer advocates said pubic access to the database is important in holding financial firms accountable.
“Mick Mulvaney has just told bankers he can hide their misconduct from the public by making the complaint database private,” said Debbie Goldstein, executive vice president of the Center for Responsible Lending. “If he does so, he will be making it easier for predatory lenders to fleece consumers. That would violate the mission that Congress gave the consumer bureau: to protect consumers and make markets more transparent.”