U.S. congressmen recently grilled Richard Cordray, the director of the Consumer Financial Protection Bureau, about the federal watchdog agency’s compliance with regulations intended to safeguard Main Street businesses.
House Republicans charged that the CFPB could hinder the recovery of a fragile U.S. economy, adding that the compliance costs associated with CFPB rules may discourage small businesses from focusing on job creation. CFPB opponents also told Cordray that the agency’s economic assessment of its impact on the economy is inaccurate.
“There appears to be holes in the agency’s assessment of the economic impact on small businesses and very little discussion of how the alternatives may reduce economic burdens,” Sam Graves (R-Mo.), the chairman of the House Small Business Committee, said, according to The Washington Times.
Congress pushed the agency to create small business review panels to consider input from those businesses affected by the agency’s new regulations.
“Small businesses are a critical growth engine for the economy and an essential source of financial services for many consumers,” Cordray said, The Washington Times reports. “For this reason the CFPB believes that it is very important to understand the impacts of its actions on small business.”
Rep. Scott R. Tipton (R-Colo.) questioned the compliance burden associated with hundreds of pages of regulation. Cordray said, however, that many of the regulations were accompanied by guidance suggestions at the request of businesses on the review panels.
“It’s counterintuitive for me,” Cordray said, according to The Washington Times. “I prefer to have short simple rules. But these are complicated matters. They asked for more specificity, more detail, which ultimately means more pages. If they can have more specificity and clarity upfront, then there will be less to argue about afterwards, less litigation and also more certainty for them on how to proceed.”