The CFPB has been a target of criticism from opponents who claim that the agency has excessive power and authority. Verret said that the agency “enjoys immunity from oversight by the President, substantial immunity from review by the judicial branch and complete immunity from budgetary review by Congress,” Forbes reports.
The House approved a bill in June that would eliminate the Federal Reserve as the CFPB’s independent funding source and would subject the consumer watchdog to the congressional appropriations process beginning 2014. The Obama administration maintains that the bill is unconstitutional and has vowed to veto all House spending measures, according to The Hill.
Verret points to the agency’s authority, calling CFPB Director Richard Cordray the “czar of czars,” Forbes reports.
“He…may only be removed for neglect or malfeasance in office,” Verret said, according to Forbes. “That is not true of most other financial regulatory agencies, where the President can replace the Chairman at will by designating another commissioner as chairman.”
Additionally, Verret said that, as U.S. courts are “required to defer to the CFPB” regarding the interpretation of federal consumer protection statutes, the agency’s director has the authority to determine which practices are considered “unfair, deceptive or abusive,” adding that a federal judge would likely be unable to stop him.
Verret also said that the agency threatens the ability of low- and middle-income families to obtain credit, as banks issue more fees to recoup revenue lost as a result of Dodd-Frank.
“President Roosevelt had a famous sign on his desk that read ‘The buck stops here,’” Verret said, Forbes reports. “Unfortunately, President Obama has passed the buck along to an unaccountable credit czar. In doing so, he shows a fundamental misunderstanding of the way jobs are financed and created.”