As Roseanne Rossannadanna would say, “never mind.” The previously reported major reorganization of the CFPB, announced last month, is now on hold. The 180-degree turn was reported by Bloomberg Law, which obtained an internal email from Bryan Schneider, the associate director of the Supervision, Enforcement and Fair Lending (SEFL) division.
The proposed, new Office of SEFL Policy and Strategy was to be led by Associate Director of Supervision Policy, Peggy Twohig. Bloomberg Law said that
The new office would have the power to approve any new investigations and research matters proposed by the CFPB’s enforcement division. The CFPB’s enforcement division currently has the authority to open investigations without outside approval, a power unique among federal financial regulators.
The proposed reorganization drew condemnation from Democratic lawmakers, including Sen. Sherrod Brown (D-Ohio), the ranking member of the Senate Banking Committee. They said the changes would allow big banks and others to resolve problems through the confidential supervisory process, and avoid potential penalties and public scrutiny of their actions.
But the reorganization was expected to take months to complete, in part because it required negotiation with the CFPB’s National Treasury Employees Union bargaining unit.
The turnabout may have been generated by a number of factors, internal pushback among Bureau staff, the complexity of the task, and the incoming Biden Administration which will likely replace Director Kraninger.