What Could Possibly Go Wrong? Trump administration Lets CFPB’s Supervision and Exam Staff Plummet By a Third

Trump’s Ideology Of Letting Wall Street Police Itself Is Just Asking for Another Financial Crisis 


WASHINGTON, D.C. – A new damage report is out today on the progress President Trump’s jack of all trades and master of none, former acting CFPB Director Mick Mulvaney, made in his mission to gut the CFPB from within. According to Bloomberg Law’s reporting, agency leadership has refused to fill critical staff positions across the agency and at every level: most alarmingly, supervision and examination staff at the CFPB’s headquarters in D.C. has plummeted by one-third between October 2017 and the end of 2018, while top-level positions like Student Loan Ombudsman and assistant director for servicemember affairs also have been willfully left vacant.

“Does the Trump administration want another financial crisis, because this is how you get another financial crisis, followed by a recession,”said Jeremy Funk, spokesman for Allied Progress. “What’s happening at Trump’s CFPB – whether it’s refusing to conduct military lender examinations, or deregulating the predatory lending industry, or pulling the plug on the Equifax data breach investigation, or refusing to fill critical consumer watchdog positions – is the advancement of a dangerous right-wing ideology that Wall Street should be left to regulate itself and hope for the best. Instead of hoping financial industry CEOs don’t do what they always do and engage in risky behavior with other peoples’ money, CFPB Director Kraninger should consider at least restoring staff to 2017 levels when the agency was successfully recovering billions of dollars for consumers victimized by illegal business practices. But if Kraninger is going to continue to empty out the CFPB, why does she even bother showing up to work at all?”

WHAT YOU NEED TO KNOW:

The CFPB’s Fall From Grace Under The Trump Administration

CFPB Staffing Has Fallen Under The Trump Administration, Hobbling Its Effectiveness As A Financial Regulator.

The CFPB’s Supervision And Examination Staff In DC Has Significantly Decreased Under The Trump Administration.

The CFPB’s Supervision And Examination Staff Decreased By A Third From October 2017 To The End Of 2018. “Supervision and examination staff at the CFPB’s Washington headquarters, for example, fell by a third from 60 in October 2017 to 39 at the end of 2018, according to bureau staff directories obtained through a Freedom of Information Act request. Overall, bureau headcount has dropped nearly 11 percent since the departure of former Director Richard Cordray in November of 2017.” [Evan Weinberger, “Fewer Consumer Finance Cops Examining Banks Under Trump,” Bloomberg Law, 02/15/19]

  • “Supervision And Examinations Staff In The Bureau’s Washington Headquarters Fell From 60 On Oct. 24, 2017 To 46 On April 19, 2018 To 39 At The End Of 2018, According To The Directories.” [Evan Weinberger, “Fewer Consumer Finance Cops Examining Banks Under Trump,” Bloomberg Law, 02/15/19]

Supervision And Examination Staff Has Shrunk In All Regional Offices, Where The Majority Of CFPB Examinations Are Conducted.

Supervision And Examination Staff In The Western Regional Office Decreased By “As Much As 12 Percent” From October 2017 To The End Of 2018. “Most of the CFPB’s examinations are done through regional offices. Headcounts in supervision and examination teams have shrunk as much as 12 percent in the Western regional office, between October 2017 and the end of 2018, according to staff directories.” [Evan Weinberger, “Fewer Consumer Finance Cops Examining Banks Under Trump,” Bloomberg Law, 02/15/19]

Supervision And Examination Staff Shrunk By “9 Percent In The Midwest, 8.5 Percent In The Northeast And 5.9 Percent In The Southeast.” “Supervision and examination teams have shrunk 9 percent in the Midwest, 8.5 percent in the Northeast and 5.9 percent in the Southeast.” [Evan Weinberger, “Fewer Consumer Finance Cops Examining Banks Under Trump,” Bloomberg Law, 02/15/19]

There Have Also Been Staffing Decreases In Other Divisions Critical To The Bureau’s Work, Such As Rulemaking Or Enforcement

The Bureau’s Research, Markets And Regulation Division, Containing “Specialists On Mortgage, Credit Card, Consumer Lending And Collections Markets,” Decreased By 21.3 Percent From October 2017 To The End Of 2018. “It’s a similar story in the CFPB’s Research, Markets and Regulation division which includes specialists on mortgage, credit card, consumer lending and collections markets. The division’s staff fell 21.3 percent to 144 people between October 2017 and the end of 2018.” [Evan Weinberger, “Fewer Consumer Finance Cops Examining Banks Under Trump,” Bloomberg Law, 02/15/19]

  • The Research, Market And Regulation Division Is Responsible For “Writ[ing] The Rules That Govern Consumer Financial Markets And Conduct[ing] The Research To Back Up Those Rules.” “The division writes the rules that govern consumer financial markets and conducts the research to back up those rules. Currently, the bureau is rewriting its payday lending regulations and is working on new rules for debt collectors, among other regulatory efforts.” [Evan Weinberger, “Fewer Consumer Finance Cops Examining Banks Under Trump,” Bloomberg Law, 02/15/19] 

Staffing For The Bureau’s Enforcement Division Decreased By 10.1 Percent. “Staffing in the CFPB’s enforcement division also fell, from 10.1 percent to 160.” [Evan Weinberger, “Fewer Consumer Finance Cops Examining Banks Under Trump,” Bloomberg Law, 02/15/19]

The CFPB Was A Robust, Growing Agency Before The Trump Administration Neutered It

The CFPB Enjoyed Robust Growth Before The Trump Administration…

The Bureau Hired “663 Full-Time Employees By The End Of Fiscal 2011,” The Year Of Its Creation. “The bureau saw exponential growth after launching in 2011, thanks to a mission that attracted left- leaning professionals, a wage scale higher than other government agencies and independent budget authority with funding through the Federal Reserve. The bureau had hired 663 full-time employees by the end of fiscal 2011, according to its 2013 strategic plan, one of several reports to Congress each year that includes total headcounts.” [Evan Weinberger, “Fewer Consumer Finance Cops Examining Banks Under Trump,” Bloomberg Law, 02/15/19]

By April 2018, The Bureau Had Grown To “1,645 Full-Time Employees.” “The bureau’s staff grew to 1,645 full-time employees, according to an April 2018 semi-annual budget report. Headcount including contractors reached 2,167 prior to Cordray’s departure and fell 10.7 percent to 1,935 at the end of 2018.” [Evan Weinberger, “Fewer Consumer Finance Cops Examining Banks Under Trump,” Bloomberg Law, 02/15/19]

The CFPB Has Been Severely Diminished Under The Leadership of Trump Appointees

A Hiring Freeze, As Well As A “Top-To-Bottom Review Of Bureau Operations” Led To A “Toxic Atmosphere” Under Former Acting-Director Mick Mulvaney. “Mulvaney, who’s now President Donald Trump’s chief of staff, almost immediately ordered a 30-day CFPB hiring freeze. He also conducted a top-to-bottom review of bureau operations and brought in Republican political appointees—many of them former foes of the bureau— to oversee career staff in areas including supervision, fair lending and enforcement. Those appointments, as well as moves like demoting the CFPB’s fair lending and student loan oversight units, caused a toxic atmosphere inside the bureau according to some employee surveys from the time.” [Evan Weinberger, “Fewer Consumer Finance Cops Examining Banks Under Trump,” Bloomberg Law, 02/15/19] 

The Decline Of The Bureau Has Continued Under Mick Mulvaney’s Successor, Kathy Kraninger, Who Has Virtually Frozen Growth By Not Hiring New Employees To Replace Those That Have Left.“The bureau has not laid off staff or moved to make significant reductions, but it appears the bureau has not been replacing employees who leave. Supporters of the consumer finance cop see the trend continuing under Kraninger, who started a five-year term as director Dec. 12. She was Mulvaney’s deputy when he ran the Office of Management of Budget.” [Evan Weinberger, “Fewer Consumer Finance Cops Examining Banks Under Trump,” Bloomberg Law, 02/15/19]

The Bureau has projected “falling budgets for fiscal 2019 and 2020,” a particularly alarming fact as “compensation and benefits [made] up a combined 53 percent of fiscal 2017 spending.” “The bureau has already projected falling budgets for fiscal 2019 and 2020. According to the bureau’s most recent budget overview, the bureau had a $553 million budget for fiscal 2018, and it projected budgets of $533 million for fiscal 2019 and $503.9 million for fiscal 2020. Personnel expenses make up the largest cost by far, with compensation and benefits making up a combined 53 percent of fiscal 2017 spending.” [Evan Weinberger, “Fewer Consumer Finance Cops Examining Banks Under Trump,” Bloomberg Law, 02/15/19]

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