’Here to stay’: Consumer bureau chief poised for big moves after surviving court challenge

The Consumer Financial Protection Bureau was bracing for survival until the Supreme Court ended years of uncertainty by ruling that its funding stream is constitutional.

Now, the agency is poised to resume its role as Wall Street's biggest nemesis.

The bureau said Friday that it will expand its enforcement office by nearly 40 percent, renew its push to pursue more than a dozen court cases and legal actions that were stalled by the litigation and develop new regulations on credit markets.

“The court's ruling makes crystal clear the CFPB is here to stay,” Director Rohit Chopra said on a call with reporters Friday. “The CFPB will be firing on all cylinders.”

The high court, in a 7-2 decision Thursday, rejected an argument by payday lenders that Congress’s decision to insulate the CFPB from the annual budget process violated the Constitution’s clause about appropriations of federal money.

The closely watched case had threatened to severely curtail the power of the bureau, which has been a partisan lightning rod since it opened its doors in 2011. The agency, which says it has returned $20 billion to consumers since its inception, was the brainchild of Sen. Elizabeth Warren (D-Mass.), then a professor, and she helped set it up.

The case also posed a potential threat to the viability of other agencies across the government, including the Federal Reserve and other banking regulators, who also don’t draw money from the congressional appropriations process. And if the high court had upheld a lower court’s ruling throwing out a 2017 payday lending rule, a broad swath of other CFPB regulations would have been thrown into question.

Financial industry groups, many of which have long loathed the bureau because of its aggressive enforcement, were divided over the outcome. While the payday lenders sought nullification of agency rules, mortgage bankers warned that a decision casting doubt on existing regulations would throw their market into turmoil.

Now that the case is settled, “the CFPB will be able to forge ahead with our law enforcement work,” Chopra said. “During the pendency of the Supreme Court case, a number of the CFPB enforcement actions were put on pause. … Given our workload, we are increasing the ranks of our enforcement office.”

The enforcement office is adding 75 staff members — attorneys, investigators, paralegals and economists — to its ranks for a total of 275 staff, a senior CFPB official said.

The bureau is also pursuing 14 matters — including litigation and Civil Investigative Demand enforcement actions — which had been stayed or were inactive because one of the companies in question cited the pending Supreme Court case, the official said.

Chopra also hinted at new regulations on the horizon: “Expect to see more work when it comes to credit reports and credit scores,” he said.

Republicans are still vowing to rein in the agency, which they see as a rogue regulator with little accountability.

“Under Director Chopra, the agency routinely and brazenly acts outside of the scope of its authority — regulating through blog posts and enforcement actions,” said Tim Scott, the top Republican on the Senate Banking Committee. “I will continue to work to hold the bureau accountable and push back on its abuse of power driven by politics instead of policy.”

A bill from Rep. Andy Barr (R-Ky.), who is running to be the next chairman of the House Financial Services Committee, would place the bureau under annual congressional appropriations.

Warren said she expects additional future attacks on the agency.

“The big banks came after us, payday lenders came after us, the Republicans came after us, and we're still standing,” she said. “We don't fool ourselves. They'll come back again. They'll have another attack. They'll figure out another way to go after the agency. They'll do it again and again and again.”