Home > Uncategorized > Republican State AGs Resisting Cooperation With Consumer Bureau – Bloomberg

Republican State AGs Resisting Cooperation With Consumer Bureau – Bloomberg

September 20, 2012 Leave a comment Go to comments

A group of Republican state attorneys general has declined to sign cooperation agreements with the Consumer Financial Protection Bureau, part of an escalating Republican revolt against the agency that began in the U.S. Congress.

Richard Cordray, the agency’s director, asked all 50 states in March to sign a memorandum of understanding designed to protect confidential information shared among states and the bureau. To date, only 12 states — all but one with Democratic attorneys general — have signed, according to the bureau and documents obtained in a public records request.

Oklahoma Attorney General Scott Pruitt said in an interview that he is declining to sign the agreement because of legal objections to the law that created the consumer bureau, the 2010 Dodd-Frank Act.

“There are misgivings I have about the authority and scope and power of the CFPB and the power granted to the director,” Pruitt said in an interview. “Frankly, until some of those issues are fleshed out, it is very premature for a state to enter into an MoU.”

The CFPB was created by Dodd-Frank to consolidate federal consumer protection authority in a single agency. Since starting work in July 2011, it has set up a complaint system for consumer financial services, proposed regulations on housing finance and is studying areas including mandatory arbitration, payday lending and overdraft protection.

State Cooperation

Cooperation with state attorneys general has been a signature effort of the consumer bureau since Harvard professor Elizabeth Warren began setting it up in late 2010. Warren, who is now running for the Senate as a Democrat from Massachusetts, touted state law enforcers as “natural partners” for the agency because of their focus on consumer protection.

Republicans opposed creation of the bureau, and Senate Republicans refused to confirm anyone to the position of CFPB director. That standoff led President Barack Obama to install Cordray as director on Jan. 4 using a process known as a recess appointment.

At least two Republican state attorneys general are preparing to file a lawsuit as soon as this week challenging the constitutionality of Dodd-Frank and the powers it granted to the bureau and its director.

South Carolina Attorney General Alan Wilson, who is leading the effort with Pruitt, told a campaign rally in Greenville, South Carolina, last week that a suit against the Dodd-Frank would be filed in the “next couple of days.”

via Republican State AGs Resisting Cooperation With Consumer Bureau – Bloomberg.

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