On Tuesday, White House budget director and acting interim director of the Consumer Financial Protection Bureau, Mick Mulvaney, introduced his plan for a more tempered, data-driven, governing philosophy for the CFPB.

In a three-page memo sent to CFPB employees, Mulvaney emphasized the CFPB would continue to enforce consumer protection laws but stressed it would operate within the confines mandated by Congress in the Dodd-Frank Act. This is a marked change from what Mulvaney characterized as the previous governing philosophy at the CFPB to “push the envelope,” as expressed by former director Richard Cordray.  

Mulvaney expressed concern over the unintended consequences such aggressive enforcement actions could have on the economy, American citizens, and the rule of law in general. Enforcement using the “full weight of the federal government,” Mulvaney noted, should be used only as a last resort after careful consideration of all component interests and circumstances.  

To implement this philosophy, Mulvaney suggested the actions of the CFPB, in both rulemaking and enforcement, will be data driven; with an emphasis on quantitative – rather than qualitative – analysis. Further, the bureau will focus on formal rulemaking providing interested parties with notice of what the rules are, instead of “regulation by enforcement.” 

Mulvaney specifically identified that almost one third of the complaints submitted to the CFPB in 2016 were related to debt collection. A closer inspection of the 2016 Consumer Response Annual Report, reveals that roughly three-quarters of the consumer complaints dealt with continued attempts to collect debts allegedly not owed, alleged improper or insufficient disclosures, and claims of improper communication tactics. Given Mulvaney’s statement that this type of data will inform the agency’s actions going forward, the debt collection industry may expect to see that the CFPB will continue to focus on debt collection issues even under Mulvaney’s approach.

We will continue to monitor the CFPB’s actions as it begins to implement Mulvaney’s interpretation of the agency’s role in the regulatory and enforcement landscape.