The Consumer Financial Protection Bureau would have its funding controlled by Congress and its enforcement activity heavily restricted under a two-year “restructuring” plan proposed by the Trump administration.

In its fiscal year 2019 budget request to Congress, the White House’s Office Management and Budget said it wants to put the CFPB budget under direct congressional oversight beginning in 2020.

During the transition, the White House budget request proposes to only allow the Federal Reserve Board to transfer $485 million to the CFPB during FY19, the same as during 2015.

The CFPB’s budget was established as a portion of the Fed’s operating budget to keep it independent from the political dynamics of the congressional appropriations process.

The Trump budget request proposes a $6.5 billion reduction to the agency’s budget by 2028 under the revised funding mechanism. The proposal also calls for restricting the bureau’s “broad enforcement authority.”

“These changes would allow CFPB to focus its efforts on enforcing enacted consumer protection laws and eliminate the functions that allowed the Agency to become an unaccountable bureaucracy with unchecked regulatory authority,” the proposal says, without providing more detail.

Part of the criticism is the agency’s organization under a single director, rather than a commission. That structure has resulted in a lack of congressional accountability in a director who can exercise “broad authority to unilaterally develop and enforce regulations irrespective of congressional intent or economic impact,” according to the budget request.

The White House is hoping to pass its CFPB overhaul via legislation, though it’s unclear whether such legislation has strong prospects of being enacted.

Strategic Plan

Nevertheless, the budget request speaks to the new policy priorities of its interim director, Mick Mulvaney, who concurrently serves as permanent OMB director. Consumer advocates say those simultaneous positions, with one foot inside the White House and another within an independent agency, poses significant conflicts of interest.

Mulvaney and other Republicans view the CFPB as having far exceeded its authority in aggressively pursuing payday lenders, financial institutions and other companies during the Obama administration.

In a strategic plan for 2018-2022 released Feb. 12, Mulvaney underscored that he’d be taking the CFPB in a different direction than under previous director Richard Cordray.

“If there is one way to summarize the strategic changes occurring at the Bureau, it is this: we have committed to fulfill the Bureau’s statutory responsibilities, but go no further,” Mulvaney said.

That doesn’t mean the CFPB won’t take on future rulemakings, however. The strategic plan contemplates periodically reviewing them for clarification or modernization, or to take on new rulemakings “to address unwarranted regulatory burdens.”

It would also consider new rules or activities related to emerging markets and products or changing market conditions.