The "CFPB Dual Mandate and Economic Analysis Act" amends the Consumer Financial Protection Act to modify the CFPB's mandate, prioritize economic analysis, and ensure regulations promote market competition and consumer choice.
Tom Emmer
Representative
MN-6
The CFPB Dual Mandate and Economic Analysis Act would modify the Consumer Financial Protection Bureau's (CFPB) objectives to focus on "fair and transparent" markets, removing "competitive," and aim to strengthen private sector participation, increase competition, and enhance consumer choice. It establishes an Office of Economic Analysis within the CFPB to review and assess the impact of the Bureau's actions on consumer choice, price, and access to credit, as well as review existing rules to measure their success. The CFPB Director must consider these assessments before issuing any guidance or regulations and must provide a written explanation if disagreeing with the Office's assessment. The director will also need to identify the problem each proposed rule or regulation aims to solve and specify the metrics for measuring the rule's success.
CFPB Overhaul Proposed: Bill Adds Economic Review Office, Alters Agency Mission
This proposed legislation, the "CFPB Dual Mandate and Economic Analysis Act," introduces significant changes to how the Consumer Financial Protection Bureau (CFPB) operates. It establishes a new internal division, the Office of Economic Analysis, tasked with scrutinizing nearly every action the Bureau takes. Additionally, it modifies the CFPB's core purpose stated in Section 1021(a) of the original Consumer Financial Protection Act, shifting the focus from ensuring markets are "competitive" to ensuring they are "fair and transparent."
The New Economic Gatekeeper
The biggest structural change is the creation of the Office of Economic Analysis (Sec. 3). Think of this as a built-in economic impact team. Before the CFPB issues any new rules, official guidance, or enforcement orders, this office must review them. Their analysis will specifically weigh the potential effects on consumer choice, the price of financial products, and your access to credit – basically, how it hits wallets and options. These reviews aren't internal memos; they're required to be published in the Federal Register for public viewing. This office is also tasked with looking backward, reviewing major CFPB rules 1, 2, 5, and 10 years after they're implemented to see if they actually solved the problems they were meant to fix.
Mission Shift: 'Competitive' vs. 'Fair and Transparent'
The bill tweaks the CFPB's foundational goal (Sec. 2). Instead of explicitly aiming for "competitive" markets, the revised language emphasizes making markets "fair and transparent." It also adds language directing the Bureau to enforce laws in a way that strengthens private sector participation and avoids government interference or subsidies, aiming to boost competition and consumer choice through these means. This might sound like a small wording change, but it could influence how the CFPB approaches its job. For instance, a focus solely on 'fairness and transparency' might prioritize clear disclosures and stopping deceptive practices, potentially placing less emphasis on actions designed to actively break up market concentration or foster new, disruptive competitors in the financial space.
The Director's Role and Rulemaking Process
Under this bill, the CFPB Director is required to consider the Office of Economic Analysis's findings before finalizing any rule or order (Sec. 3). If the Director decides to proceed despite a negative assessment from the economic office, they must provide a written explanation justifying their decision. Furthermore, when proposing new rules, the Director must clearly identify the specific problem the rule intends to solve and define measurable metrics to track its success, including how it impacts consumer access to, and the cost of, financial products and services. This adds layers of justification and required analysis to the rulemaking process, potentially leading to more data-driven regulations but also creating more procedural steps before new consumer protections can be put in place.