In this report, we assess CFPB Director Kraninger’s appearance today before a partisan and rancorous HFSC. Moments before the hearing, the panel’s Democrats issued a report arguing that the CFPB fails to protect consumers, calling for legislation to strengthen the CFPB’s enforcement powers. Chairwoman Waters (D-CA) and Rep. Maloney (D-NY) echoed these concerns, with Rep. Maloney saying the CFPB’s failure under Director Kraninger to obtain financial restitution for consumers made it “worthless.” Republicans argued that this was a personal attack on Director Kraninger, forcing Rep. Maloney later to clarify her remarks. Republicans led by Ranking Member McHenry (R-NC) praised the CFPB’s work on fintech sandboxes and no-action letters (see FSM Report FINTECH27) and Director Kraninger’s decision to argue that the President should be able to remove the CFPB Director at his discretion. Rep. Hill (R-AR) asked the CFPB to lead the effort to modernize the AI regulatory framework; Director Kraninger said that this is under way with other agencies, noting also that the CFPB is considering harmonizing its standards on disparate impact for algorithmic underwriting with those recently proposed by HUD (see FSM Report FAIRLEND6).
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