WASHINGTON, D.C. – Today, Congressman Blaine Luetkemeyer (MO-03), top Republican on the Subcommittee on Consumer Protection and Financial Institutions, Congressman Patrick McHenry (NC-10), top Republican on the House Financial Services Committee led a letter with House Financial Services Committee Republicans to Consumer Financial Protection Bureau (CFPB) Director Rohit Chopra regarding the CFPB’s new unfair, deceptive, or abusive acts and practices (UDAAPs) supervisory policy and the recent changes to CFPB administrative adjudication procedures that deviate significantly from past practices.  

Read the full letter to Director Chopra here.

Read key excerpts from the letter:

“We are writing to express our concern with respect to two recent actions taken by the Consumer Financial Protection Bureau (CFPB).  In particular, the CFPB’s new unfair, deceptive, or abusive acts and practices (UDAAPs) supervisory policy and the recent changes to CFPB administrative adjudication procedures deviate significantly from past practices. Moreover, notwithstanding the fact these actions were taken outside of the typical notice and comment process, they suggest the CFPB intends to pursue a regulatory and enforcement agenda well beyond its statutory authority.  We call on you rescind these measures immediately and adhere to the appropriate notice and comment paradigm.”

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“Let us be clear, there is no place for discrimination in financial services.  If illegal discriminatory practices are identified, they should be addressed through the enforcement of existing laws, such as the Equal Credit Opportunity Act (ECOA) and the Fair Housing Act – known together as the fair lending laws.  Congress enacted the fair lending laws and delegated their enforcement to the CFPB, clearly defining the limits of CFPB’s jurisdiction. Extending ECOA’s disparate treatment and disparate impact analysis to non-credit financial products and services ignores these clear limits.  Moreover, the CFPB’s recent decision to fundamentally alter long-standing fair lending policy was made outside of the rulemaking process.”

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“Considering the significance of the changes adopted under the new UDAAP policy, we believe it would be inappropriate for the CFPB to pursue actions under the policy through the administrative adjudication process.  The new interpretation within the policy should be considered by a non-partisan, independent judge.  We believe this should be the practice for all cases but particularly when the CFPB circumvents the rulemaking process.  The CFPB must not pursue actions under these theories and then be allowed to judge the legality of its own actions and processes and impose significant penalties.”