Members of the House Committee on Financial Services criticized the CFPB’s consumer financial data collection practices during a hearing on Tuesday, during which CFPB Acting Deputy Director Steven Antonakes was unable to answer their questions.
Antonakes, who was unable to say how many American consumers the CFPB has collected data on, was asked by respond to a report by Bloomberg that said the agency has demanded records from financial institutions and is purchasing information on at least 10 million consumers from companies like Experian, Daily Finance reports.
Antonakes said the CFPB relies on data analysis to determine how consumer financial products and services work.
“Data analysis is also fundamental to fulfilling our mandate to protect consumers,” Antonakes said. “Analysis of data, as the law creating the Bureau prescribed, enables the Bureau to not only better protect and educate consumers, but it also enables the Bureau to coordinate with other regulators and craft tailored rules based on a careful examination of costs and benefits. The Bureau’s evaluation of this data also allows it to provide meaningful reports, as required by Congress, and to perform its consumer response function.”
Dodd-Frank prohibits data collection “for purposes of gathering or analyzing the personally identifiable financial information of consumers” unless the data is provided by consumers voluntarily.
Though Antonakes said the CFPB operates within its legal limits, committee members criticized the agency’s refusal “to provide concrete answers to questions that have been asked in public forums.”
“The American people have a right to know how this government agency is collecting and using their personal financial data,” Rep. Shelley Moore Capito (R-W. Va.), the chairman of the subcommittee, said. “We simply do not know the extent to which the CFPB is collecting, storing or having outside contractors collect and store consumers’ personally identifiable information.”