Consumer finance bureau ‘out of control’ under Biden's director, critics say

After one of the federal government’s most powerful bureaucrats warned he would be "reining in repeat offenders," the nation’s largest business group wants to rein in his powers. 

The U.S. Chamber of Commerce launched a six-figure digital ad campaign in late June targeting Rohit Chopra, director of the Consumer Finance Protection Bureau (CFPB), appointed by President Biden in 2021 and confirmed without a single Republican vote. 

As head of the consumer finance bureau, he is a board member of the Federal Deposit Insurance Corporation. Before leading the CFPB, Chopra aggressively pushed regulations as a board member of the Federal Trade Commission. Chopra previously worked for a left-leaning think tank, where he advocated for creating a powerful ethics agency with near-complete autonomy from the elected branches of government. 

"He is more aggressive than his predecessors. I think he has been willing to pick fights his predecessors wouldn’t have picked," Hilary Miller, a consumer financial services attorney, told FOX business. "He wants to do something that puts him in the news every couple of days."

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In late June, Chopra restricted "junk fees," a phrase the director coined to describe extra charges imposed by debt collectors that he considers "exploitive income streams." The Chamber countered that the move was a "heavy-handed attempt to vilify legal products that have well-disclosed terms."

Chopra recently reinforced earlier moves to deputize states’ attorneys general to enforce CFPB regulations. He has also pushed the FDIC, the Federal Reserve, the FTC, and the Justice Department to follow the consumer agency’s enforcement views.

In May, Chopra announced the CFPB created a new Office of Competition and Innovation to explore what government actions can prevent large banks from squeezing out smaller competitors. 

"The CFPB began its existence under the Obama administration as a lawless and unaccountable agency," Sen. Pat Toomey, R-Pa., ranking member of the Senate Banking Committee, told FOX Business in a statement. "Unfortunately, under Director Chopra, the CFPB is more out of control than ever before. It’s once again pursuing a far-left agenda by abusing — and exceeding — its authorities."

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The U.S. Chamber of Commerce issued letters from its litigation unit and filed Freedom of Information Act requests as part of its more extensive "Rein-in-Out-of-Control CFPB Director" campaign. 

The chamber adopted the "rein-in" phrase from a Chopra speech to students at the University of Pennsylvania Law School in March titled, "Reining in Repeat Offenders."

"Agency and court orders are not suggestions, but many large companies see them as such," Chopra said during the remarks. He later added, "Repeat offenses — whether it’s for the exact same offense or more malfeasance in different business lines – is par for the course for many dominant firms, including big banks, big tech, big pharma, and more."

Instead of financial fines that companies might view as the cost of doing business, Chopra said in the speech that the CFPB will move to cap the size of growth of firms; ban certain types of business product lines; require divestitures of certain product lines; limitations on requirements to raise equity capital; and revoking a company’s government-approved patent or registration. 

The CFPB is a decade-old agency established in response to the 2008 financial crisis that is under the purview of the Federal Reserve Board with little oversight from Congress. 

A CFPB spokesperson called criticism from the U.S. Chamber of Commerce and others "scare tactics orchestrated by lobbyists for Big Tech and Wall Street."

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"We remain focused on ensuring fair, transparent, and competitive markets for American consumers and honest businesses who play by the rules," the CFPB spokesperson told FOX in an email. 

"Less than a year in, our approach is already paying dividends, with significant changes in bank overdraft policies and major reforms in the reporting of medical debt to consumer credit reports," the CFPB spokesperson added. "Big corporations and their lobbyists want to preserve a system where American families and small businesses are left to fend for themselves against those that repeatedly violate the law."

Miller, the consumer financial services attorney, said the director’s actions are essentially in line with the progressive policies of the Biden administration. 

"This is a recurring theme for the Biden administration in every agency. Every agency has a mandate for equity and inclusion; this is Mr. Chopra’s version of carrying it out," Miller said. "I don’t see him as a bad guy. I just see him as an aggressive and worthy adversary.... I don’t think he’s dishonest. I don’t think he is being manipulated by third parties. He was hired to be who he is now."

Though Chopra has been more aggressive than his predecessors, Miller said he is essentially working within the broad statute that created the agency. Chopra has advocated for concentrated government power in other areas. 

A May 2018 report that Chopra co-authored for the Roosevelt Institute, a left-leaning think tank, called for a Public Integrity Protection Agency, or PIPA, with a director appointed to a seven-to-10-year term. The proposed agency would have the ability to bring civil and criminal enforcement actions in federal court; investigate any individual or company seeking to influence federal officials; and assume the president’s responsibility for appointing inspectors general at federal agencies. 

The concept of PIPA has strong similarities to the CFPB, Miller said, from the standpoint of investing significant powers to a director, while other autonomous government agencies are generally commissions. 

"It is an independent agency within the Federal Reserve Board and by definition is not subject to congressional oversight," Miller said. "There is no commission to whom the director is accountable. He’s a king in his kingdom."

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Chopra’s actions will harm consumers and businesses if he isn’t held accountable, said Neil Bradley, executive vice president and chief policy officer at the U.S. Chamber of Commerce. 

"Rohit Chopra has an outsized view of the CFPB’s role and the Director’s power," Bradley said in a public statement. "By willfully mischaracterizing the state of competition in the market Chopra is laying the groundwork to force the financial services sector to comport with his personal vision of the appropriate size of companies and what products and services should be offered and under what conditions. No previous CFPB Director has thought they had such power."