Obama Consumer Finance Protection Bureau Flouts Transparency Law

On its website, the Obama Consumer Financial Protection Bureau (CFPB) proudly boasts:

Our mission is… ensuring that consumers get the information they need to make the financial decisions they believe are best for themselves and their families—that prices are clear up front, that risks are visible, and that nothing is buried in fine print. In a market that works, consumers should be able to make direct comparisons among products and no provider should be able to use unfair, deceptive, or abusive practices.

And that, to put it kindly, is what is popularly known as “false advertising.” In fact, it is so palpably false that it might be laughable – were the CFBB’s perversion of its own mission not so serious. The recent efforts by Judicial Watch and the Washington Examiner shed some sunlight into the operations of the CFPB and provide new insights into why this secretive, shadowy agency should never have been created in the first place.

On March 3, 2014, we filed a Freedom of Information Act (FOIA) lawsuit on behalf of the Washington Examiner against the CFPB seeking to obtain records detailing $90 million in cost overruns for the remodeling of the CFPB Washington headquarters. According to a February 14 Examiner article, over the past two years, the cost of the remodeling project has soared from $55 million to $145 million. How’s that for making sure “that prices are clear up front, that risks are visible, and that nothing is buried in fine print?”

Judicial Watch filed its lawsuit in support of a July 24, 2013 FOIA request filed by Richard Pollock, a senior investigative reporter at the Washington Examiner, seeking access to records concerning the headquarters’ renovation. Over the course of several months, the CFPB notified the Examiner that it had located a total of 350 pages responsive to the FOIA request. However, CFPB informed the Examiner it was withholding 335 of the 350 pages.

In an editorial addressing the CFPB refusal to comply with its FOIA request, the Examiner observed:

CFPB officials resolutely refuse to provide relevant documents sought by the Examiner concerning the building renovation. The few cursory documents that were turned over shed no light on the project. Since CFPB has all the time in the world, plus legions of lawyers and a huge budget that Congress can't touch, odds are good that shining the disinfectant of sunlight won't happen any time soon. That's an open invitation for waste, abuse and corruption.

At a heated January 28, 2014 hearing held by Rep. Patrick McHenry (R-NC), chairman of the Oversight and Investigations Subcommittee of the House Financial Services Committee, CFPB Director Richard Cordray obstinately refused to provide details about the remodeling project’s soaring costs. Rep. Jeb Hensarling (R-TX), chairman of the House Committee on Financial Services, pointed out, “You are spending more per square foot than the Trump World Tower.” McHenry subsequently asked the Federal Reserve inspector general to initiate an investigation into the cost overruns.

It has taken all of that to try to get the CFPB simply to fulfill its stated mission of “ensuring that consumers get the information they need.” They are still stonewalling, and we have now entered the fray to force their hand.

Mark Tapscott, the executive editor of the Washington Examiner, said, “Documents to explain why a government bureau is spending so lavishly on renovations to its headquarters are exactly the kind of information the FOIA is meant to make available to taxpayers. We shouldn't have to go to court to get them, but it's important to make the point that the American people have just as much of a right to know what CFPB is doing with their money as they do their local dogcatchers.”

This is not the first time Judicial Watch has gone to court to procure documents the CFPB was hiding from the public. In June 2013, we obtained records from the Consumer Financial Protection Bureau (CFPB) revealing that the agency has spent millions of dollars for the warrantless collection and analysis of Americans’ financial transactions. The documents also revealed that CFPB contractors may have been required to share the information with “additional government entities.”

The full extent of the CFPB personal financial data collection program was revealed in a document entitled “INDEFINITE-DELIVERY INDEFINITE-QUANTITY (IDIQ) STATEMENT OF WORK” stating, “The CFPB seeks to acquire and maintain a nationally representative panel of credit information on consumers for use in a wide range of policy research projects… The panel shall be a random sample of consumer credit files obtained from a national database of credit files.” At the time, the US Chamber of Commerce accused the CFPB of breaking the law by demanding the account-level data without a warrant or National Security Letter.

The fact is, from its inception, the CFPB has been placed deliberately and dangerously out of reach of oversight by the American people. It has acted with arrogant indifference to attempts to pierce its veil of secrecy, even while violating the privacy rights of millions of Americans. This lawsuit could help shed some much-needed light on what is otherwise an essentially covert operation with oppressive control over consumer finances. Judicial Watch is pleased to help the Examiner obtain these documents on behalf of the American people.


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