Regulation by enforcement is over at the Consumer Financial Protection Bureau, at least while Acting Director Mick Mulvaney leads the bureau, he told members of Congress this month.
But in testimony to the Senate Committee on Banking, Housing, and Urban Affairs and the House Financial Services Committee in mid-April, Mulvaney said eliminating regulation by enforcement, a common practice of the former director, Richard Cordray, does not mean the bureau will cease to uphold consumer protection laws.
"Regulation by enforcement is where people find out that you accuse them of breaking the law after you file a lawsuit against them. That's what I stopped," Mulvaney said. "I believe you have a right to know what the law is before I sue you for breaking it."
Though he publicly criticized the CFPB before leading it, Mulvaney maintained throughout his testimony that he is going by "the book" with the bureau, continuing investigations and litigation cases initiated under Cordray.
The pipeline to enforcement action, according to Mulvaney, begins with an investigation into alleged wrongdoing. About 100 investigations are underway at any given time at the CFPB, with one or two cases dropping off or starting each month, he said.