ACA addresses concerns with the bureau’s rulemaking processes, actions surrounding medical debt and more before hearings slated with the House Financial Services Committee and Senate Banking Committee.
12/13/2022 3:00 P.M.
3.5 minute read
Consumer Financial Protection Bureau Director Rohit Chopra will testify in two hearings on Capitol Hill this week, starting with the House Financial Services Committee (HFSC).
ACA International submitted questions for consideration during the hearing and a letter (PDF) to committee members urging Congress to consider ongoing concerns with the CFPB’s rulemaking processes, jurisdiction and actions surrounding medical debt, among others.
“In recent months, the CFPB has targeted the work of the ARM industry in several ways. One of the bureau’s apparent objectives is to completely remove any reference to outstanding medical debts from all credit reports,” said ACA CEO Scott Purcell in the letter. “This goal, if achieved, will result in negative consequences to consumers and harm medical providers throughout the country as they are grappling with reduced revenues and increase patient demand.”
ACA’s letter also focused on the bureau’s approach to rulemaking through advisory opinions, guidance and new “CFPB Circulars,” plus the pending petition for certiorari from the bureau to the U.S. Supreme Court to review a 5th Circuit Court of Appeals’ decision declaring the bureau’s funding structure is unconstitutional.
The House Financial Services Committee will hear testimony from Chopra Dec. 14 during the hearing, “Consumers First: Semi-Annual Report of the Consumer Financial Protection Bureau,” at 10 a.m. EDT.
The bureau published its semi-annual report for review at the hearing, which covers regulatory and supervisory activity from Oct. 1, 2021, to March 31, 2022.
In its memo (PDF) for the hearing, the HFSC focuses on bureau actions since April 2022, when Chopra last testified before the committee, including rulemaking developments on credit reporting, credit card late fees and consumer complaints, among other topics.
The bureau’s director typically testifies before the HFSC and Senate Committee on Banking, Housing and Urban Affairs in the spring and fall. The hearing before the Senate Banking Committee is Thursday, Dec. 15.
ACA Advocacy
Last April, ACA submitted a letter to the HFSC for the hearing outlining its concerns with the CFPB’s actions in recent weeks and rhetoric toward the accounts receivable management (ARM) industry on behalf of members.
ACA builds on those concerns in this month’s letter, including addressing the CFPB’s interpretive rule issued as an advisory opinion on “junk fees” in the debt collection market that lacked stakeholder input.
ACA’s letter for last year’s HFSC hearing focused on the bureau’s actions related to medical debt credit reporting and student loans, including in the form of inflammatory news releases, research with outdated facts and an inaccurate portrayal of the debt collection industry as one that is unregulated.
These actions by the bureau continue, in addition to a myriad of actions the bureau has taken outside of the rulemaking process and their negative impact for the ARM industry, which ACA addressed in a letter to Chopra in October.
“The uncertainty created by the CFPB’s wide swings in priorities, and its lack of accountability over the past several years, have prompted the need for judicial scrutiny of the agency,” said Leah Dempsey, ACA’s lobbyist and shareholder at Brownstein Hyatt Farber Schreck. “As the Supreme Court considers key questions about the bureau’s structure and accountability, it would be appropriate for the CFPB to pause all policymaking, which would further complicate the outstanding questions created by the 5th Circuit Court of Appeals’ ruling.”
If legal challenges to the CFPB’s funding structure are reviewed by the U.S. Supreme Court as requested by the bureau, it’s likely they could send the issue back to Congress to determine how to bring the CFPB under the congressional appropriations process.
ACA will provide updates for members on the HFSC hearing discussion as well as the CFPB hearing with the Senate Banking Committee. ACA’s letter (PDF) for the Senate hearing was filed with the committee Dec. 13.
In the next Congress, where Republicans will have a majority in the House of Representatives, oversight of the CFPB will likely ramp up under leadership of U.S. Rep. Patrick McHenry, R-N.C., who was nominated as chair of the HFSC.
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