With President-elect Donald Trump's
But some observers say that, while the next administration will certainly change the agency's trajectory, those modifications may be more limited in their scope than the bureau's most ardent opponents would prefer.
Richard Horn, co-managing partner of Garris Horn and a former senior counsel and special advisor at the CFPB, said the appointment of noted CFPB critic Mick Mulvaney as acting director in President Trump's first term was a signal that the administration intended to handcuff the agency from doing anything of consequence. But instead of appointing Mulvaney or someone similarly aligned as the permanent director, the administration instead appointed Kathy Kraninger, who cut a more moderate path at the agency.
"The appointment of Kathy Kraninger as the permanent director of the CFPB, I think, indicated they were looking for somebody who might be more moderate," Horn said. "She had a very active enforcement docket at the CFPB, with some cases that one would expect to be controversial in the eyes of a Republican administration. So if the past is prologue, I think that … could indicate that they take a more moderate route. That approach can also make sense in a more populist agenda, if that's the direction that the Trump White House goes in."
Joseph Lynyak, a partner at Dorsey & Whitney LLP, likewise said that efforts to dismantle the CFPB entirely would require an act of Congress — and a filibuster-proof majority in the Senate to do so, which the incoming administration will not enjoy. He also said he doubts the new Senate majority would dispense with the filibuster because it would enable a future Democratic majority to move its own priorities in the same way.
"They don't have 60 votes, so that's not going to happen," Lynyak said. "There are institutional people there that realize, 'Hey, if we do it to you, you're going to do it to us, and maybe it's not a really good idea.'"
Sen. Elizabeth Warren, D-Mass., who first conceived of the CFPB and won reelection to her third Senate term on Tuesday, indicated that she would not be willing to make changes to the bureau's structure, suggesting that attaining 60 votes in the upper chamber to reshape the bureau into a commission or bring it under congressional appropriations is unlikely.
"We beat the big banks on Wall Street and cracked down on overdraft and junk fees," Warren said during her victory speech Tuesday night. "I led the charge to create the Consumer Financial Protection Bureau — go CFPB — and now, with a cop on the beat, big banks have been forced to return more than $20 billion directly to consumers they cheated."
One thing the incoming administration will likely do is terminate some longtime employees at the agency who do not share their policy goals, Lynyak said.
"They are going to clean out senior staff — just completely clean them out," he said. "Under the recent Supreme Court cases, they can simply fire anybody they want. And there have been people who have been there — well entrenched, if you will — for many, many years."
Some of the agency's more controversial rules will likely be scuttled, including the CFPB's recently completed registry of
But in the case of 1033, there is a considerable degree of Republican support in Congress for the rule in general, if not for the precise contours of the rule as promulgated under the Biden administration. Horn said that rule is a good example of a friction between a longstanding Republican distaste for the bureau and the more populist strains in the Trump agenda.
"Having the ability for consumers to shop between banks easily I think would actually be in conformance with a populist agenda," Horn said. "But again, the devil is in the details. There could be ways that a Trump-appointed director would disagree with a cost-benefit analysis for that rule [or] specific provisions under that rule. So there definitely could be amendments that could be made, even if they don't fully withdraw."
