With the official launch of the Consumer Financial Protection Bureau (CFPB) just days away, presidential adviser Elizabeth Warren will return Thursday to what some are calling the “torture chamber” – better known as the House Oversight and Government Reform Committee.
Warren last testified before the Republican-led committee in late May, emerging bloodied but not broken after Rep. Patrick McHenry accused her of lying. “You’re making this up,” McHenry said on May 24 after Warren told the panel she could not remain for more questions because she had been misled about how long she would be expected to testify.
The Thursday hearing, which will be led by Chairman Darrell Issa of California, is scheduled for 0930 ET through 1130 ET and carries the ominous title, “Consumer Financial Protection Efforts: Answers Needed.”
Warren has been a favorite target of Republicans on Capitol Hill since the Dodd-Frank financial reform law was passed a year ago. The former Harvard law professor, who had the idea to create a federal agency that would police U.S. banks and financial services companies on behalf of consumers, is unlikely to ever head the new bureau..
Senate Republicans have vowed to block an Obama administration nomination of Warren to head the CFPB. They’ve even gone one step farther and threatened to block anyone nominated for the job – unless the CFPB is restructured to weaken the director’s authority.
“We should never entrust a single person with this much power and public money,” Sen. Richard Shelby, the top Republican on the Senate Banking committee, recently said. The CFPB director is supposed to have a five-year term, much like the head of the Federal Deposit Insurance Corp.
House Republicans, meanwhile, are doing their best to whittle down the money available to the CFPB to do its job protecting consumers. A House bill would limit the agency’s 2012 funding to $200 million, less than half of what it expected to receive from the Federal Reserve. Other House legislation would gut the Fed funding process altogether, and subject the bureau to the annual, politically-charged appropriations process.
The CFPB officially opens its doors on July 21 with the authority to enforce various pro-consumer regulations that it inherits from the Federal Reserve and other agencies, including conducting examinations of big banks. However, until it has a confirmed director, the bureau is generally restricted from proposing new regulations for payday lenders, auto title companies, consumer credit scoring companies, and other financial services that are now unregulated.
Other Congressional hearings, rulemaking deadlines and events related to the Dodd-Frank financial reform law this week:
Monday, July 11
Barney Frank – Democratic Rep. Barney Frank, a co-author of the Dodd-Frank financial reforms signed into law on July 21, 2010, holds a news briefing to discuss the status of the law one year after it took effect. Begins 1000 ET at the National Press Club.
Derivatives capital requirements – Deadline for public comments on a proposal by banking regulators and the Commodity Futures Trading Commission to set margin and capital requirements for swap dealers and major swap traders, which would vary based on the risk of the transaction. The proposed requirements would not apply to end users of derivatives contracts.
Investment adviser fees – Deadline for public comments on the Securities and Exchange Commission’s proposal to raise to $2 million in net worth – up from a current $1.5 million – the threshold at which investment advisers can charge a performance fee.
Tuesday, July 12
Investor protection – Senate Banking Committee holds hearing on investor protection improvements since the financial crisis. Testifying are representatives of the Consumer Federation of America, Municipal Securities Rulemaking Board, and North American Securities Administrators Association. Begins 1000 ET and will be webcast.
Financial education – President’s Advisory Council on Financial Capability meets and will receive reports from subcommittees on financial access, research, partnerships and youth. Begins 1430 ET and will be webcast.
Fannie, Freddie legal fees – A House Financial Services subcommittee meets to draft legislation that would eliminate a government-sponsored enterprise charter for Fannie Mae and Freddie Mac, and would also limit legal fees paid by Fannie and Freddie to defend former top executives from private lawsuits.
Wednesday, July 13
Fed’s report card on economy –Federal Reserve Chairman Ben Bernanke delivers his semi-annual testimony on monetary policy and the state of the U.S. economy to the House Financial Services Committee. Begins 1000 ET and will be webcast.
Crisis commission – House Oversight and Government Reform subcommittee holds hearing titled, “What went wrong at the Financial Crisis Inquiry Commission?” Begins 0930 ET. Witnesses TBA.
Thursday, July 14
Fed’s report card II – Federal Reserve Chairman Ben Bernanke delivers his semi-annual testimony on monetary policy and the state of the U.S. economy to the Senate Banking Committee. Begins 1000 ET and will be webcast.
Elizabeth Warren – House Oversight and Government Reform Committee holds hearing about the Consumer Financial Protection Bureau with testimony from Elizabeth Warren, a special adviser to the White House who is creating the agency. Begins 0930 ET and will be webcast.
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