Mick Mulvaney: A Masterclass in Transparency Avoidance

 Dodging FOIAs, Not Answering Questions, Avoiding Oversight…All in a Day’s Work for Mulvaney & Co. 

Under Mick Mulvaney, The CFPB Has Repeatedly Attempted to Keep Congress in The Dark About the Bureau’s Activities

Mulvaney Has Repeatedly Dodged Questions from Members of Congress About His Work At The CFPB…

Mulvaney Failed to Provide Any Requested Documentation Regarding His Ties to The Payday Lending Industry When Asked by A Number of Democratic Senators in A Congressional Letter. “Illustrative is Mr. Mulvaney’s response to a letter asking how his ties to the payday lending industry may have impacted several of his pro-industry decisions. The Senators’ letter asked Mr. Mulvaney to provide any documentation of communications with industry representatives prior to the decisions to halt implementation of the payday rule, reconsider the rule through a rulemaking, dismiss a CFPB lawsuit against several payday lenders, and drop its investigation of a specific payday lender. In responding, Mr. Mulvaney failed to provide any of this documentation or even acknowledge the request.” [“Pushing the Envelope: The Consumer Financial Protection Bureau Under the Trump Administration,” Senate Committee on Banking, Housing, and Urban Affairs, 11/27/18] 

When Asked About the CFPB’s Decision To “Freeze Collection of Consumers’ Data Used to Track Consumer Complaints and Identify Discrimination,” Mulvaney Ignored the Questions Stating He Had “Near Complete Discretion and Autonomy Regarding How the Bureau Will Meet Its Statutory Obligations.” “For example, when asked about reports that the CFPB would freeze collection of consumers’ data used to track consumer complaints and identify discrimination, Mr. Mulvaney sidestepped the question by stating that, as acting Director, he had “near complete discretion and autonomy regarding how the Bureau will meet its statutory obligations,” and that he would continue data collection in instances where not doing so would “unduly hamper” the CFPB’s ability to carry out its obligations.” [“Pushing the Envelope: The Consumer Financial Protection Bureau Under the Trump Administration,” Senate Committee on Banking, Housing, and Urban Affairs, 11/27/18]

When Asked About The “Impact of A Freeze on The Civil Penalty Fund and The Criteria [He] Would Use to Determine Whether to Make An ‘Exception,’” Mulvaney Responded with An Explanation of How the Civil Penalty Fund Worked. “Likewise, when asked about the impact of a freeze on the Civil Penalty Fund and the criteria Mr. Mulvaney would use to determine whether to make an ‘exception,’ Mr. Mulvaney responded with a largely boilerplate response about how the Civil Penalty Fund works.” [“Pushing the Envelope: The Consumer Financial Protection Bureau Under the Trump Administration,” Senate Committee on Banking, Housing, and Urban Affairs, 11/27/18] 

When Asked About His Decision to Reorganize the Office of Fair Lending and Equal Opportunity Mulvaney “Copied and Pasted Part of a Publicly Available Regulatory Filing with Another Agency and Claimed It Was Responsive.”“Responses to inquiries regarding Mr. Mulvaney’s decisions to reorganize the Office of Fair Lending and Equal Opportunity and stop reporting on a number of risks to students in the CFPB’s student banking report were similarly oblique. In response to one request, Mr. Mulvaney copied and pasted part of a publicly available regulatory filing with another agency and claimed it was responsive.” [“Pushing the Envelope: The Consumer Financial Protection Bureau Under the Trump Administration,” Senate Committee on Banking, Housing, and Urban Affairs, 11/27/18] 

… And May Have Even Given Untruthful Answers. 

During A Senate Banking Committee Hearing, When Asked If He Had “Rubbed Elbows with Payday CEOs Or Their Lobbyists and Lawyers in Exotic Locations” Mulvaney Answered No Despite Having Discussed A CFPB Case with The Founder of a Payday Loan Company While at A Golf Event in The Bahamas. “Consider Mr. Mulvaney’s response in a Senate Banking Committee hearing regarding whether he had ‘rubbed elbows with payday CEOs or their lobbyists and lawyers in exotic locations.’ Mr. Mulvaney responded: ‘No, sir. The only contact that I’ve had that I know of with anybody associated with the industry was as part of our community groups that we have.’ He went on to explain that he had met with industry-affiliated individuals ‘in the ordinary course of business,’ but this was the only contact of which he was aware.” [“Pushing the Envelope: The Consumer Financial Protection Bureau Under the Trump Administration,” Senate Committee on Banking, Housing, and Urban Affairs, 11/27/18]

  • The New York Times Reported That Mulvaney Spoke With, Paul Reddam, Founder of Cashcall, A Payday Loan Company, While at A Golf Event in The Bahamas. “In fact, as reported by The New York Times, Paul Reddam, the founder of CashCall—a company that offers triple-digit interest-rate payday loans—spoke with Mr. Mulvaney at a golf event in the Bahamas about the CFPB’s case against the company for its high-cost loans. According to the Times’s sources, Mr. Mulvaney “responded that he thought all of the payday cases had already been dismissed, but would refer the request to a deputy.” An inquiry by the Committee obtained confirmation of this encounter from Reddam’s attorneys.” [“Pushing the Envelope: The Consumer Financial Protection Bureau Under the Trump Administration,” Senate Committee on Banking, Housing, and Urban Affairs, 11/27/18] 

Meanwhile, Agencies Under Mick Mulvaney Have Impeded and Delayed Efforts to Provide Information to The Public.

Under Mulvaney, The CFPB Has Attempted to Evade FOIA Requests from The Public… And Even Tried to Withdraw Allied Progress’ Status as A FOIA Requester.

Prior To Mulvaney’s Arrival, “The CFPB Determined That Allied Progress Was an Exempt Noncommercial Requester for Fee Purposes and Limited Fees to Duplication Costs. “Based on the CFPB’s responses to one requester, Allied Progress, the CFPB under Mr. Mulvaney appears to have changed its FOIA practices to hide its activities from public view. On November 21, 2017—less than a week before Mr. Mulvaney started at the Bureau—the CFPB determined that Allied Progress was an exempt noncommercial requester for fee purposes and limited fees to duplication costs (which are negligible for electronic documents).” [“Pushing the Envelope: The Consumer Financial Protection Bureau Under the Trump Administration,” Senate Committee on Banking, Housing, and Urban Affairs, 11/27/18]

  • The Freedom of Information Act “Authorizes Agencies to Collect Fees to Cover the Costs of Processing Requests, But Limits These Fees Based on The Type of Requester” With News Media and Noncommercial Requesters Only Being Charged for Duplication Costs. “Enacted in 1966, FOIA provides the public with the right to access records from any federal agency, subject to certain exemptions. FOIA also authorizes agencies to collect fees to cover the costs of processing requests, but limits these fees based on the type of requester. For news media and certain other noncommercial requesters, FOIA and CFPB regulations limit fees to document duplication costs. [“Pushing the Envelope: The Consumer Financial Protection Bureau Under the Trump Administration,” Senate Committee on Banking, Housing, and Urban Affairs, 11/27/18]

After Mulvaney’s Arrival, The Bureau Changed the Requester Status of Allied Progress, No Longer Exempting Them from Search and Processing Fees. “After Mr. Mulvaney seized control of the Bureau, however, the CFPB changed its determination. In response to a series of FOIA requests submitted in January 2018, the CFPB, led by Mr. Mulvaney, stated that it no longer considered Allied Progress to be exempt from search fees and provided fee estimates in the thousands of dollars per request.” [“Pushing the Envelope: The Consumer Financial Protection Bureau Under the Trump Administration,” Senate Committee on Banking, Housing, and Urban Affairs, 11/27/18]

The CFPB Only Reversed This Decision After A Formal Appeal Was Filed and Never Explained Why. “Ultimately, on April 23, 2018, the CFPB reversed its determination that Allied Progress did not qualify for an exemption from search fees, but it did so only after the organization lodged a formal appeal. In the meantime, over three months had elapsed since the initial request. The CFPB did not explain its initial departure from its prior determination, and it took a full month to respond to Allied Progress’s appeal.” [“Pushing the Envelope: The Consumer Financial Protection Bureau Under the Trump Administration,” Senate Committee on Banking, Housing, and Urban Affairs, 11/27/18]

Allied Progress Has Attempted to Obtain Records from Mulvaney’s Agencies Via FOIA And Been Stymied Frequently 

As of November 28, 2018, Allied Progress Has 35 FOIA Requests Filed with The Consumer Financial Protection Bureau (CFPB) That It Has Not Yet Received Records in Response To.

These include FOIA requests seeking:

  • A report on student lending referenced in former CFPB Student Loan Ombudsman Seth Frotman’s resignation letter.
  • Emails between high-ranking CFPB officials (Eric Blankenstein and Hallee Morgan) related to the Military Lending Act.
  • Emails related to Eric Blankenstein blog posts and the purported “rebellion” that ensued at CFPB.
  • A simple request for staff calendars has been unanswered for 82 days. 

As of November 28, 2018, Allied Progress Has 27 FOIA Requests Filed with The Office of Management and Budget (OMB) That It Has Not Yet Received Full Responses To (Or in Some Cases, Any Response.)

These include FOIA requests seeking:

  • Information related to Kathy Kraninger, Nominee for CFPB Director (11 separate requests, filed starting in June 2018).
  • E-Mail correspondence between Mulvaney and the payday lending industry.
  • Copies of Mulvaney’s travel receipts and itineraries.

Allied Progress Even Had to Go to Court to Try to Get Mulvaney And the Trump Administration to Turn Over Records on Kraninger. 

Allied Progress Has Had to Go to Court to Try to Compel the Trump Administration to Release Records on Kraninger. The Case Is Ongoing. [Merle, Renae, “Advocacy group sues for CFPB nominee’s work records,” Washington Post, 07/25/18] 

Mick Mulvaney Has Also Taken Steps to Avoid Independent Oversight and Scrutiny by Those Who May Disagree with Him. 

Mulvaney Disbanded A Legally Required Consumer Advisory Board Filled with Consumer Advocates and Created A New One with Fewer Members and No Formal Authority. 

In June 2018, Mulvaney Disbanded the Bureau’s Consumer Advisory Board. “Mick Mulvaney, acting director of the Consumer Financial Protection Bureau, fired the agency’s 25-member advisory board Wednesday, days after some of its members criticized his leadership of the watchdog agency. The CFPB said it will revamp the Consumer Advisory Board, known as the CAB, in the fall with all new members. The panel has traditionally played an influential role in advising the CFPB’s leadership on new regulations and policies. But some members, who include prominent consumer advocates, academics and industry executives, began to complain that Mulvaney was ignoring them and making unwise decisions about the agency’s future.” [Renae Merle, “Mick Mulvaney fires all 25 members of consumer watchdog’s advisory board,” The Washington Post, 06/06/18]

  • Mulvaney Replaced the Original 25-Member Consumer Advisory Board with A Board of Just Six Members. “On June 5, Mulvaney signed an amended charter to reconstitute the consumer advisory board with only six members, according to a copy of the charter obtained by American Banker. A day later, the board’s 25 volunteer members were fired.” [Kate Berry, “CFPB advisory board 2.0: Far fewer members,” American Banker, 07/18/18]
  • The New Board’s Amended Charter States That It Has “No Formal Decision-Making Role and No Access to Confidential Supervisory or Other Confidential Information.” “The board’s new amended charter states that the board “will have no formal decision-making role and no access to confidential supervisory or other confidential information.” [Kate Berry, “CFPB advisory board 2.0: Far fewer members,” American Banker, 07/18/18] 

Mulvaney’s CFPB Folded Its Student Loan Office into A Separate Office, A Move Critics Said Would Weaken the Bureau’s Efforts to Protect Borrowers… 

In May 2018, Mulvaney Folded the Bureau’s Student Loan Office into Another Office at The Bureau “The student arm of the Consumer Financial Protection Bureau is being folded into another office at the agency, a consolidation that some fear will limit its ability to stand up for student loan borrowers. In a memo obtained Wednesday by The Washington Post, Mick Mulvaney, acting director of the CFPB, informed staffers of a reorganization that will tuck the office for students and young consumers into the bureau’s office of financial education.  [Danielle Douglas-Gabriel, “Mick Mulvaney takes aim at consumer bureau’s student protection unit,” The Washington Post, 05/09/18] 

  • Critics Said the Move Would Weaken Consumer Protections. “The move raised alarm bells among consumer advocates, who said that Mulvaney was once again seeking to weaken consumer protections by moving the student loan division under the broader financial education unit. [Donna Borak and Katie Lobosco, “Changes at CFPB’s student loan division worry advocates,” CNN Money, 05/09/18] 

… While Also Allegedly Suppressing A Report from The Office On “How Banks Were Ripping Off Students.” 

In August 2018, The CFPB’s Top Advocate for Student Borrowers Resigned from The Bureau and Accused Mulvaney and His Leadership Team Of “Suppressing A Report on How Banks Were Ripping Off Students.” “The federal government’s top official charged with protecting student loan borrowers announced his resignation on Monday, saying the Trump administration is making it impossible for him and other career staffers to do their job. Seth Frotman, the student loan ombudsman at the Consumer Financial Protection Bureau (CFPB), wrote in a scathing letter on Monday that bureau leadership ‘has turned its back on young people and their financial futures.’ The letter, to acting CFPB Director Mick Mulvaney and other leadership, accuses the agency of siding with business interests over the consumers it is supposed to protect — including suppressing a report on how banks were ripping off students.” [Emily Stewart, “The government’s top student loan watchdog is quitting in protest,” Vox, 08/28/18]

Mulvaney’s Top Staff Even Directed Staffers to Conceal a Mulvaney Appearance Before an Anti-CFPB Group from The Press. 

CFPB Officials Instructed Bureau Communications Staff to Conceal a Mulvaney Appearance at a Conservative Organization That Had Opposed CFPB Rules from Reporters. “Top Consumer Financial Protection Bureau officials instructed the bureau’s communications staff to conceal a June appearance by acting Director Mick Mulvaney before a Republican state attorneys general organization that opposed the bureau’s payday lending rule, according to emails obtained by Bloomberg Law.” Emails obtained by Allied Progress showed “that two top staffers in the CFPB’s external affairs division, Anthony Welcher and Zixta Martinez, instructed communications staff not to tell reporters in advance about a June 9 appearance Mulvaney was scheduled to make at the Rule of Law Defense Fund.” [Evan Weinberger, “CFPB Didn’t Disclose Mulvaney Meeting With GOP Group in Advance,” Bloomberg Law, 09/20/18]

  • “Government Transparency Advocates Said That There Was No Justification for The CFPB Not to Disclose Mulvaney’s Appearance.” “Government transparency advocates said that there was no justification for the CFPB not to disclose Mulvaney’s appearance before the RLDF or any other group until after the fact, even if the events are closed to the press. John Wonderlich, the executive director of the Sunlight Foundation, said that the CFPB does not have to bind itself to requests from event organizers not to disclose an appearance by its acting director even if there is no legal requirement to do so prior to an event. ‘It may not be illegal, but it still might be egregious and appalling,’ Wonderlich said in a Sept. 20 phone interview.” [Evan Weinberger, “CFPB Didn’t Disclose Mulvaney Meeting With GOP Group in Advance,” Bloomberg Law, 09/20/18]

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