As of April 6th, Pres. Obama was still reviewing names to run the CFPB. Those following the formation of the CFPB know that Professor Elizabeth Warren has been its chief architect. When testifying before the House Subcommittee on Financial Institutions and the Consumer Committee on Financial Services, Warren indicated that private loan companies would be held accountable for wrongdoing and failure to comply with federal laws and regulations. That is encouraging news for the indentured educated class!
Perhaps it is a failure on my part (i.e. as a researcher), but there seems to be scant information on the way in which the CFPB will handle private loan companies. I do know one thing, there needs to be a private loan ombudsman at the CFPB. I hope that this fledgling agency does not look to hire from the same circles. There needs to be new blood, and I am especially interested in how they will oversee private student loan companies. So, here are my questions: what's the status on hiring there? Who's doing the hiring? Will there be an entire division devoted to private loans? From my understanding, it appears that the operations are coming out of the Treasury Department, but that is the most I have gathered.
The age old question for a solution that comes up in so many contexts:
Where to find an uncorrupted and truly objective and independent body or panel, oversight committee, or review board etc.?
You raise excellent points. One way to find out more about this process and to participate is to find out when Elizabeth Warren is being interviewed on a talk show and then call in to the show. We can search the internet, particularly the npr.org website. There are advocacy groups that helped provide the push to get this board created -- we need to find out who those groups are and connect with them. The more of a coalition we build, the better.
I was quite close to setting up a talk with Warren herself. However, that was over two years ago. I'm going to give it another try. I had success in the past, so it will be round two.
The CFPB is a crying shame. Ever since they announced last June how Treasury would "stand up" the new agency, it was clear that it would be more revolving door nonsense -- a mixture of Wall Street veterans and staff veterans borrowed from the other federal regulators of financial services -- agencies which were already exposed as extremely ethically compromised during the last few financial crises.
At the very bottom of their list is finding people with customer service interests/experience. It could be argued that someone with customer experience at Walmart or Comcast would be better than someone with world-class expertise in securitizations who has no customer-related experience. Yet that is not the direction they have chosen to go.
Even worse, every few months CFPB and/or Treasury issues a press release announcing more high-level crony hires. Perhaps because Congress chose to avoid the political battles of the 1970s involved in creating a distinct, independent cabinet-level executive branch consumer affairs agency (with a "Secretary of Consumer Affairs") and instead stick it in the Federal Reserve, the "standing up" of CFPB has been largely done in secret, like a private corporation, rather than publicly and competitively, as a true government agency would be doing. The hiring has largely been noncompetitive. While hiring political buddies, cronies and friends can certainly result in some excellent appointment, it is not the level of transparency which had been promised by both the Obama Administration and its Congressional critics. Instead they have apparently cooperated in a bipartisan patronage effort.
I agree about the scant info. A friend handed Ms. Warren a copy of my book, saying I had devoted more than two years to these issues. Ms. Warren enthusiastically accepted the book saying student loans were a major issues the CFPB would handle. Emails and even job applications from me have gone without so much as a "dear occupant" response. They must be busy.
@Laura Oy vey! :(
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