Bradley attorney Michael Gordon was quoted in Bloomberg Law on the CFPB changes to expect under Joe Biden. Under a Biden presidency, the CFPB's primary focus will likely be combatting COVID-19 and being much more aggressive monitoring banks and financial companies for compliance with mortgage and student loan forbearance, credit reporting, and other protections included in pandemic relief legislation.
That could give the CFPB’s new management cover from Republican and industry critics, at least in its opening months, said Gordon.
“People are hurting, and efforts to help consumers weather this downturn will be hard for the agency’s critics to argue against,” he added.
Former CFPB director, Mick Mulvaney, took the CFPB’s fair lending unit out of the bureau’s Supervision, Enforcement and Fair Lending Unit, placing it inside and under the control of the director’s office. Look for a Biden-appointed CFPB director to reverse that change, Gordon said.
“That’s not hard to achieve organizationally, but symbolically it gives the administration a win and it gives fair lending a seat at the table,” he said.
A more recent organizational reshuffling under current director, Kathy Kraninger, resulted in the CFPB’s enforcement division losing its ability to independently launch investigations. That change is also unlikely to survive new management, Gordon added.
The CFPB projected a budget of $580.1 million for fiscal 2020 and $595.2 million for fiscal 2021, far below the $695.9 million transfer cap for fiscal 2020, and $717.5 million for fiscal 2021.
That leaves the Biden administration plenty of room to boost its enforcement and supervisory ranks, Gordon said.
“They left $100 million on the table, and I expect the new team to utilize much more of the available funds — including to bulk up on staffing,” he said.
The original article, “Covid-19 Response to Drive Biden’s CFPB in Early Days,” appeared in Bloomberg Law on November 12, 2020.