Last week, Sen. Chuck Grassley (R-Iowa) introduced a non-binding amendment that would establish an independent inspector general at the CFPB, addressing concerns from the agency’s critics that the watchdog has over-expansive authority.
“Inspectors general serve as watchdogs, keeping an eye on the executive branch for Congress and the American people,” Grassley said. “Their mission includes everything from fighting waste and fraud to making sure agencies operate effectively and efficiently. Because this agency is housed within and predominantly funded by the Federal Reserve, there is little independent oversight of it. Sunlight is the best disinfectant, and an inspector general would help create accountability, oversight and transparency in this new government bureau.”
Critics of the CFPB maintain that the agency lacks oversight and accountability. The CFPB does not have its own watchdog but is, instead, under the supervision of the Federal Reserve’s inspector general.
Grassley’s amendment, which is co-sponsored by Sen. Tom Coburn (R-Okla.), would put lawmakers on the record in opposition or in support of oversight at the agency, which has remained a point of partisan disagreement, The Hill reports.
The SEC, CFTC and FDIC are under oversight of independent inspectors general, while the OCC, which is officially housed under the U.S. Treasury, is overseen by the Treasury’s independent watchdog.
Senate Republicans have vowed to oppose CFPB Director Richard Cordray’s nomination to lead the agency unless key changes are made, including the replacement of Cordray with a five-member, bipartisan commission and the placement of the agency’s budget under the congressional appropriations process, according to The Hill.