Mulvaney Defends Role Running Agency He Wants to Cripple

April 11, 2018

WASHINGTON — Mick Mulvaney, interim director of the consumer protection agency created during the Obama administration, said on Wednesday he is committed to "enforcing the law" as Democrats questioned his fitness, commitment and legal right to run a bureau he once vowed to kill.

Late last year, President Trump gave Mr. Mulvaney, the White House budget director, the additional job of running the Consumer Financial Protection Bureau, an agency that Mr. Trump and congressional Republicans would like to neutralize, if not eliminate.

Mr. Mulvaney, who recently called on Congress to cripple the agency and who scrapped a planned action against a payday lender accused of abusive practices shortly after taking the helm, insisted on Wednesday that "we are still going after the bad actors." He said he had authorized the agency's lawyers to proceed with "25 cases" initiated by his predecessor Richard Cordray, a Democrat currently running for governor of Ohio.

"I have not burned the place down," said Mr. Mulvaney, a former Republican congressman from South Carolina who vigorously opposed the creation of the bureau, which he once referred to as a "sick, sad joke."

Mr. Mulvaney told members of the House Financial Services Committee that the bureau had reclaimed about $92.6 million from lenders who engaged in abusive or fraudulent practices, though he acknowledged the remittances came from actions begun by Mr. Cordray, who recovered about $12 billion from financial institutions during his tenure.

He also said he has not initiated any new enforcement actions or lawsuits since taking the job in November. He said he is "operating in a more restrained way" that included factoring in the impact of the agency's investigations on the financial health of businesses, a view he has also encouraged the bureau's employees to adopt.

Democrats were not impressed. "Some have said you are the fox in the henhouse," said Representative Stephen Lynch of Massachusetts. "Before you took over we had about an investigation a week. All of a sudden the investigations have stopped. We got a goose egg."

Other Democrats, including the committee's ranking member, Representative Maxine Waters of California, questioned Mr. Mulvaney's "legitimacy," arguing that Mr. Cordray's aide, Leandra English, was legally entitled to be the bureau's acting director under federal law. Mr. Mulvaney is serving pending the outcome of a legal case brought by Mrs. English.

"I want to be very clear that Democrats' participation in this hearing is not in any way an acknowledgment of Mr. Mulvaney's legitimacy at the Consumer Bureau," Mrs. Waters said. "It is necessary for us to engage with him in an oversight capacity here today while the courts decide who should actually be in charge."

Mr. Mulvaney, sitting on the edge of his hardback chair as he answered questions before his former House colleagues, attempted to shift questions about his performance to his top political priority: getting Congress to remove the agency's funding authority from the Federal Reserve and shift it to lawmakers. The Dodd-Frank law, which created the bureau, specifically placed the agency under the Fed's purse-strings to ensure its independence and limit the influence of payday lenders and bank lobbyists.

The plan has virtually no chance of passing the Senate, according to legislative aides and administration officials.

Mr. Mulvaney, who said he had "two full time jobs," said he visits the consumer bureau office almost every day of the week, albeit for a short time on some days. He has agreed to forego the director's salary.

"It is impossible to do two full-time jobs, that's a problem," said Representative Joyce Beatty of Ohio.

Mr. Mulvaney said he has tried to keep both responsibilities from overlapping, maintaining two separate email accounts and employing two different executive assistants. But he came under fire for his approval of a modest office renovation intended to give him and his staff more privacy.

In recent weeks, workers have installed frosted panes onto the glass walls on about a dozen offices, including Mr. Mulvaney's, at the bureau's rented downtown Washington headquarters. The renovation cost about $3,500 and was authorized — but not undertaken — by Mr. Cordray, Mr. Mulvaney said at the hearing.

"You are the champion of transparency, you have obscured yourself. I find that ironic, sir," said Representative Keith Ellison, a Democrat from Minnesota.

Mr. Mulvaney responded by asking Mr. Ellison if the door to his office was transparent.

This article was originally published by The New York Times on April 11, 2018.