	Introduction

The Consumer Financial Protection Bureau (CFPB) has been a controversial product of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act). Is the CFPB as an institution structured appropriately so as to achieve the correct balance between independence on the one hand and transparency and accountability on the other? Congress has assessed these questions using a range of its authorities, including holding oversight hearings and providing advice and consent during the confirmation of the CFPB's director. This report focuses on Congress's exercise of another of its authorities—the consideration of legislation related to the CFPB. After providing an overview of the CFPB, the report examines some of the legislative proposals from the 113 th Congress that have seen committee or floor action and that respond to the two policy questions described above. Financial regulators generally have certain characteristics that increase their independence from the President or Congress, and that independence may make policymaking more technical and less political or partisan, for better or worse. Independence may also make regulators less accountable to elected officials and can reduce presidential and congressional influence, at least in the short term. Since the CFPB was established, some have argued that it has too much independence and not enough accountability. They point to structural issues, such as that the CFPB is headed by a single director rather than a board and that it is funded outside the traditional congressional appropriations process. Supporters of the CFPB highlight other aspects that they argue provide transparency and accountability, including the CFPB director's biannual testimony before Congress and the cap on the CFPB's funding. Some argued that the presence of enforcement attorneys created an adversarial dynamic between the CFPB and the financial institution. One of the long-standing issues in the regulation of consumer financial services is the perceived trade-off between protecting consumers and ensuring the providers of financial goods and services are not unduly burdened. If regulation intended to protect consumers increases the cost of providing a financial product, a company may reduce how much of that product it is willing to provide and to whom it is willing to provide it. Those who still receive the product may benefit from the enhanced disclosure or added legal protections of the regulation, but that benefit may come at the cost of a potentially higher price for the product. Some Members of Congress believe that, in its rulemaking, the CFPB has struck the appropriate balance between protecting consumers and ensuring that credit availability is not restricted due to overly burdensome regulations on financial institutions, especially small banks. Others counter that some of the CFPB's rules have imposed compliance costs on lenders of all sizes that will result in less credit available to consumers and restrict the types of products available to them. This section will evaluate CFPB-related legislation that would alter the contents of the CFPB's rulemaking.
The Consumer Financial Protection Bureau (CFPB) has been a controversial product of the Dodd-Frank Wall Street Reform and Consumer Protection Act (P.L. 111-203; the Dodd-Frank Act). Some in Congress view the CFPB as an important protector of consumers and families against predatory financial actors. Others believe the CFPB is an institution not subject to sufficient accountability that imposes undue regulatory burdens on providers of financial services and limits credit available to households. This policy disagreement among Members of Congress has been on display during the controversy surrounding the confirmation of the CFPB's director, in oversight hearings, and in legislation that has been introduced.
This report focuses on selected legislation related to the CFPB that has seen committee or floor action during the 113th Congress. Most of these proposals address one of two main policy topics, the structure of the CFPB and the substance of the CFPB's rulemaking.
On the first policy question, many acknowledge that the structure of a government agency may affect the policies an agency creates. Financial regulators generally are structured in statute to have characteristics that increase their independence from the President or Congress, which may make policymaking related to these regulators more technical and less political or partisan, for better or worse. Independence may also make regulators less accountable to elected officials and can reduce presidential or congressional influence.
Since the CFPB was established, some have argued that it has too much independence and not enough accountability. Critics point to structural issues, such as the presence of a director rather than a board and funding that is outside the traditional congressional appropriations process. Supporters of the CFPB highlight other aspects that they argue provide transparency and accountability, including the CFPB director's biannual testimony before Congress and the cap on the CFPB's non-appropriated funding. Other structural characteristics, they argue, are important for ensuring that the CFPB is somewhat insulated from political pressures and can focus on the technical aspect of policymaking.
With regard to the second policy question, one of the long-standing issues in the regulation of consumer financial services is the perceived trade-off between protecting consumers and ensuring that the providers of financial goods and services are not unduly burdened. If regulation intended to protect consumers increases the cost of providing a financial product, a company may reduce how much of that product it is willing to provide and to whom it is willing to provide it. Those who still receive the product may benefit from the enhanced disclosure or added legal protections of the regulation, but that benefit may come at the cost of a potentially higher price for the product and reduced availability for others.
Some Members of Congress believe the CFPB has struck the appropriate balance in its rulemaking between protecting consumers and ensuring that credit availability is not restricted due to overly burdensome regulations on financial institutions, especially small banks. Others counter that some of the CFPB's rules have imposed compliance costs on lenders of all sizes that will result in less credit available to consumers and restrict the types of products available. An analysis of whether recent rulemaking has restricted the availability of credit is complicated by the effects of the financial crisis on the supply of and demand for credit, as well as the fact that many of the more significant CFPB rulemakings only took effect in early 2014.