Yellen to Barr: No Fed Oversight of CFPB's $600 Million Budget
In response to questions from Congressman Andy Barr (KY-06) during a Committee on Financial Services hearing, Federal Reserve Chair Janet Yellen confirmed that the Fed does not approve or even oversee the budget of more than $600 million a year it gives to the Consumer Financial Protection Bureau. Because the Bureau receives its funding directly from the Fed, it is beyond the reach of Congress's power of the purse to rein in its regulatory overreaches and lavish spending.
After the hearing, Congressman Barr said, “Given the history of regulatory overreach and questionable spending by the Bureau, it is awfully discouraging that their budget is not overseen by Congress or even by the source of their funding, the Federal Reserve. We need to fix this problem by passing the TABS Act which I introduced to put the Bureau in the appropriations process so that Congress can oversee the Bureau’s budget and hold them accountable through the power of the purse for the first time.”
Congressman Barr has introduced H.R. 1486, the Taking Account of Bureaucrats’ Spending (TABS) Act, which would move funding for the CFPB into the Congressional appropriations process. In doing so, Congress would be able to oversee the Bureau’s budget.
The Bureau has not proven to be a responsible steward of taxpayer dollars. For example, the Bureau is reportedly spending more than $215 million to renovate its headquarters, in a building it does not own and which is only worth $153 million. A November 2014 review by the non-partisan Government Accountability Office found serious internal accounting deficiencies in the Bureau’s control of its own budget.