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The Consumer Financial Protection Bureau Isn't Protecting Consumers!
Townhall.com ^ | August 15, 2015 | Ken Blackwell

Posted on 08/15/2015 4:59:49 AM PDT by Kaslin

When a government agency called the Consumer Financial Protection Bureau (CFPB) is created by Congress, one would expect that a few consumers could actually receive protection, but that hasn’t been the case with this agency’s track record of mismanagement, inefficiency and waste. The CFPB has been operating for four years now and if it were a sports team, its coach, Richard Cordray, would certainly be looking for work.

CFPB was created as part of a Washington law known as “Dodd-Frank” – named for sponsors former Sen. Christopher Dodd and former Rep. Barney Frank. When CFPB director Cordray announced the laudable goal of investigating instances ofdiscriminatory lending practices, one would have expected to see a team of crack financial analysts and consumer watchdogs identifying racially motivated lending, assessing fines and awarding money to victims. Sorry, that hasn’t happened under director Cordray’s watch.

CFPB tried developing a statistical modeling system using zip codes and last names to pinpoint minorities victimized bydiscriminatory lending practices. The resulting data was supposed to alert regulators to minorities targeted for unfair treatmentby lenders. Unfortunately the CFPB produced a garbage in - garbage out statistical report that is virtually unusable. A peer reviewed study revealed that the CFPB’s methodology for estimating African-American borrowers was off by as much as 41%. The report also said the CFPB method was, “conceptually flawed” and can, “contribute to inflated estimates of alleged consumer harm.”

CFPB has also been unable to make restitution to victims of alleged lending problems in a case involving Ally Financial. In 2013 the CFPB found that Ally Financial committed wrongdoing and slapped the institution with an $80 million fine. Ally contested the charges but settled the case. Now, more than a year since Ally Financial paid its fine, not one dollar has been distributed to lending victims. Again the agency’s convoluted statistical modeling system is apparently unable to identify actual victims for restitution. The 230,000 minority consumers who were alleged victims of discriminatory lending have nothing.

What did the CFPB do with the $80 million fine under Cordray’s leadership? Rather than improve its internal systems to identify victims, the CFPB gave the money away to various organizations that work with low-income and minority borrowers. The list of organizations receiving money from CFBP reads like a, “Who’s Who” of powerful left-wing activist groups. It’s likely no coincidence that these same groups receiving money from CFPB pushed for the agency’s creation in the first place.

And, the very agency charged with protecting minorities is itself facing charges of racial discrimination. A number of CFPB employees testified before Congress about CFPB’s hostile workplace environment. Employees offered examples of mistreatment, discrimination and fear of reprisal for voicing objections. Lawmakers received reports of how black employees were constantly belittled and even racially stereotyped during agency sponsored events.

The President of the National Treasury Employees Union Chapter 335, which represents CFPB employees, testified that he’s observed widespread problems within the agency. The union president Robert Cauldwell, also a CFPB examiner, heavily criticized the agency’s director:

“Last year, when Director Cordray testified before Congress that he cared about these legitimate complaints of discrimination and retaliation, I believe he was sincere. However, actions speak much louder than words. Director Cordray’s inaction over the past year has created a more discriminatory, challenging, and intimidating workplace for CFPB employees…..

Management runs the experienced employees off, especially the older employees, and then hires new and inexperienced people who management can shape and mold into their own image. They send these new employees, who have never worked in the industry or litigated a case in court, to training classes for two or three weeks, and then put them in charge of decision making about the institutions we supervise.”

The inefficiency of the CFPB under Richard Cordray has revealed a disturbing pattern of sloppiness and mismanagement from an agency created to offer consumers substantive protection. The CFPB has become a classic example of why so many people in America today have little faith in the federal government’s ability to better our society. Congress needs to reexamine the CFPB and either clean house or shut the doors. The job of consumer financial protection is clearly not getting done.


TOPICS: Editorial; Government
KEYWORDS: cfpb; cordray; doddfrank; eib; exportimportbank; glasssteagall

1 posted on 08/15/2015 4:59:49 AM PDT by Kaslin
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To: Kaslin

“and can, “contribute to inflated estimates of alleged consumer harm.””

So its working as designed.


2 posted on 08/15/2015 5:03:40 AM PDT by driftdiver (I could eat it raw, but why do that when I have a fire.)
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To: driftdiver

Current CFPB rules have inflated certain costs to home buyers and home refinances. For example, the rules have inflated appraisal fees by 50% with over half the money going into the lenders’ pocket while cutting the fees paid to appraisers.


3 posted on 08/15/2015 5:06:25 AM PDT by rstrahan
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To: Kaslin

“When a government agency called the Consumer Financial Protection Bureau (CFPB) is created by Congress, one would expect that a few consumers could actually receive protection...”

“The Affordable Care Act”

“The Environmental Protection Agency”

“The Patriot Act”

Why on earth would anyone ever expect a government agency called the “Consumer Financial Protection Bureau” to do anything but screw consumers over?


4 posted on 08/15/2015 5:18:44 AM PDT by Junk Silver
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To: Kaslin

From the moment I heard about this “agency” I knew it was sham designed to filter money out to Odumass’s friends.


5 posted on 08/15/2015 5:20:05 AM PDT by raybbr (Obamacare needs a deatha panel)
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To: Kaslin

I remember how successful the Do Not Call Registry was. It ended up being a marketing list or at least sure seems like it.


6 posted on 08/15/2015 5:20:58 AM PDT by jsanders2001
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To: Kaslin
The CFPB has been operating for four years now and if it were a sports team, its coach, Richard Cordray, would certainly be looking for work.

The inefficiency of the CFPB under Richard Cordray has revealed a disturbing pattern of sloppiness and mismanagement from an agency created to offer consumers substantive protection.

Boy this guy is good!

It usually takes new government program a decade or more to achieve this level of incompetence.

I bet this guy will be the next Democrat president’s chief of staff.

7 posted on 08/15/2015 5:27:34 AM PDT by Pontiac (The welfare state must fail because it is contrary to human nature and diminishes the human spirit.)
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To: jsanders2001

First of all it helps to have a caller ID and preferable one with audio which I have. I don’t answer calls from numbers that I don’t recognize, and I have a specific ringtone in my smartphone for those


8 posted on 08/15/2015 5:30:25 AM PDT by Kaslin (He needed the ignorant to reelect him, and he got them. Now we all have to pay the consequenses)
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To: Kaslin
CFPB tried developing a statistical modeling system using zip codes and last names to pinpoint minorities victimized bydiscriminatory lending practices, but looking around the room, we soon realized nobody had ever taken a Stat course or even knew basic math as we had all gone into government work because we had all graduated in gender studies so nobody else would hire us in the real world.
9 posted on 08/15/2015 5:33:11 AM PDT by Sirius Lee (Cruz or Lose 2016 - Regulation)
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To: Kaslin
A "track record of mismanagement, inefficiency and waste."

That could be a decsriptuon of any one of the government agencies.

10 posted on 08/15/2015 5:33:43 AM PDT by Bobby_Taxpayer
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To: driftdiver; Kaslin

The CFPB in my opinion was designed to discourage homeownership and eventually get rid of that pesky private property rights issue. As someone in the business for the last 22 yrs, I am still originating only because I’ll be damned if I’ll let the socialist SOBs keep anyone from owning a home just because of the mountains of paperwork they put in front of a borrower. If someone has good credit, good income, good assets and wants to own a home, why should they be stopped over a paperwork technicality and discouragement from “the powers that be”. The CFPB’s new regulation was touted to help the consumer. Per the Mortgage Banker’s Association (pretty well respected), the chart at this link: https://www.mba.org/Documents/Research/ChartoftheWeek%2006052015.pdf (I don’t know if I can post the actual chart) shows the basic costs to lenders to originate a mortgage loan in 2009 went from about $3,900 to $7,195 in 1st quarter 2015. The overlay of regulations from different gov’t agencies is incredibly expensive and I can’t imagine what the TRID costs are going to be after October 1st since all lenders, title companies and attorneys had to completely retool/replace their computer systems to meet the regulations. And sellers? They have no rights anymore. It’s absolutely wrong. Sorry for the lengthy post. This is usually my husband’s account but I had to respond...sick of the CFPB... wasn’t it Reagan that said something like...”I’m from the gov’t and I’m here to help...” ?


11 posted on 08/15/2015 5:59:28 AM PDT by Mac n Jac (www.vetsfightingms.org)
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To: Mac n Jac

Rather...”BEWARE THE WORDS...I’m from the gov’t and I’m here to help.:


12 posted on 08/15/2015 6:08:58 AM PDT by Mac n Jac (www.vetsfightingms.org)
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To: Mac n Jac
The lenders and title and escrow companies have had to remake the HUD about three or four times since CFPB inception. Each change, a line here or a line there cost millions in programming costs. The HUD is the government approved buyers or sellers closing statement. A new regulation coming from CFPB, now is a three day wait time before you can sign the lending documents, once the HUD is issued. This is so severe for all of us in the Real Estate industry, that the regulators had to postpone that requirement for three months. It is a overreach to say its to "protect" buyers, so after 6-8 weeks of escrow, they have another three days to wait to make sure they are not getting hosed by their lender, then they can sign?

In Real Estate even in our sales contracts, it says "time is of the essence", the essence of Real Estate is to expedite the transaction. There are numerous time frames you must adhere to, the closing date being one of the most important, but the government wants us to slow down, for the dumbshit buyers, who need 9 weeks instead of 8 to be a due diligent buyer.

13 posted on 08/15/2015 8:25:25 AM PDT by thirst4truth (America, What difference does it make?)
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