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On CFPB’s First Birthday, Watchdog Is Still Vulnerable – 7/24/12

On CFPB’s First Birthday, Watchdog Is Still Vulnerable To Possible Dodd-Frank Repeal

 

Cfpb First Birthday
The CFPB is the brainchild of Harvard Law School Professor Elizabeth Warren, who now is the Democratic challenger against U.S. Senator Scott Brown in Massachusetts.

The Consumer Financial Protection Bureau will have its first birthday on Saturday, but we’re only cautiously celebrating. The watchdog agency’s long-term survival is still an open question.

Republican presidential candidate Mitt Romney has vowed to repeal the Dodd-Frank Act, which created the bureau, if elected. A complete repeal of the law would dismantle the bureau, which serves as the first line of defense for consumers against businesses, fielding complaints about everything from applying for a mortgage to taking out a loan for college.

The GOP and the banking industry fought to prevent the bureau’s creation and have repeatedly tried to weaken and kill it.

The CFPB is the brainchild of Harvard Law School Professor Elizabeth Warren, who is now the Democratic challenger to U.S. Senator Scott Brown in Massachusetts. The Obama administration spearheaded the creation of the CFPB in response to the financial crisis and housing bust, which some say were caused in part by the predatory marketing of subprime mortgages to lower-income people as housing prices became unsustainably high.

President Obama signed the Dodd-Frank Act into law in July 2010. Then the CFPB grew inside the Treasury Department and became an official bureau on July 21, 2011. The bureau was an orphan until Richard Cordray was tapped to lead it in January as a recess appointment made by Obama. Without a director for nearly six months, the CFPB could not regulate the consumer financial industry.

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