The House of Representatives passed a bill last week that would replace the Consumer Financial Protection Bureau’s director with a five member board and would make it easier to overturn the bureau’s regulations.
The bill, passed by a 241 to 173 vote on Thursday, is aimed at scaling back the powers of the bureau, which was a key aspect of last year’s financial oversight law, according to Reuters. Republicans have actively stood against the bureau, insisting it is an unnecessary layer of regulation that could restrict consumer choice and lending.
The bill will make it easier for the new Financial Stability Oversight Council to overturn bureau regulations, Republicans said, which will put needed checks on the agency.
House Financial Services Chairman Spencer Bachus said that other agencies are run with a board instead of a director.
"I wouldn't want George Washington, I wouldn't want Abraham Lincoln, I wouldn't want Mother Theresa to have that kind of power," Bachus said, Reuters reports.
Democrats said that the bureau will protect consumer interest against the banking and lending industry and are accusing Republicans of trying to slowly bleed the agency to death.
The bill is expected to fail in the Democratic-controlled Senate and it would be vetoed by the president.
Unless Democrats agree to change how the bureau is funded, allow the FSOC to ease regulations and implement a board structure, Senate Republicans have said they will block the president’s pick of former Ohio Attorney General Richard Cordray to direct the bureau, according to Reuters.
If the Senate fails to approve the nomination, the president has the authority to place the nominee in the job while the Senate is in August recess. Cordray, however, would only be able to serve in the job for about 1.5 years instead of a five year term.