Is the CFPB Double-Dipping in Attempts to put Pressure on Lending Companies?

News broke recently about a draft letter sent from a couple of Democrat senators. This letter was sent to the Consumer Financial Protection Bureau (CFPB) and the language of the letter strongly urges the bureau to keep on bringing attention to what the letter calls “discriminatory and unfair lending practices” taking place in the auto lending industry. According to investigators, though, the properties of the actual document tell a different story. The metadata indicates that the letter might not have been penned by the senators or their staff members, but by someone who serves as a top advisor to the CFPB.

Senators Cory Booker from New Jersey and Sherrod Brown from Ohio state in the letter, “We write to urge the Consumer Financial Protection Bureau (CFPB), in the face of opposition, to continue its work to combat discriminatory and unfair lending practices, particularly in auto finance. Discrimination has no place in our financial system. We believe it is appropriate and necessary for the bureau to continue this work, and urge the bureau to do so.”

A Republican staff member, who asked to remain anonymous, provided a copy of this letter to journalistic resources. The metadata of the document seems to indicate that someone from the Self-Help Credit Union named Chris Kula is the actual author. This has not been 100 percent verified, but it does represent the earliest findings currently available to the public. Booker’s people say that this letter is a draft. Brown’s office offered no explanation.

So why would it matter if Kukla was the actual author of this letter. Well, he is currently a member of the Consumer Financial Protection Bureau’s Advisory Board and he also works for the Center for Responsible Lending. Self-Help Credit Union is based out of North Carolina and was a key contributor in the Center for Responsible Lending’s creation to battle “abusive financial practices.” Kukla has also been heavily involved with the Center’s dealings with auto lending issues. Some experts have even insinuated that the group is in very tight with the CFPB.

According to CFPB spokesperson Sam Gifford, “Members of the CFPB’s advisory boards and councils are not CFPB employees, and do not represent the views of the bureau.”

This situation is troubling because Senators should most definitely be aware if the letters they are signing were actually put together by someone who played a role in the mortgage crisis of the not-too-distant past. A “tight” relationship between this type of person and the CFPB is simply not transparent or fair to the consumers that the CFPB is supposed to be protecting, not to mention the businesses that the CFPB is in the business of putting pressure on (i.e. non-traditional lending entities.) The Director of the CFPB was once caught saying that he gets ‘withdrawal pains’ from not meeting with the Center for Responsible Lending frequently enough. Could all of this help to provide a clue as to why the CFPB is continuing to target auto lenders based upon charges that could very well be nothing more than fiction?

This whole story is just starting to see the light of day, and will undoubtedly take shape more in the weeks and months to come. The allegations are troubling, but yet to be fully verified. However, with as much bad press as the CFPB has been getting lately, the case of the bureau potentially having one of their advisors pen a letter to give to senators in order to keep pressure on auto lenders is certainly enough to leave you scratching your head, regardless of your personal opinion of the CFPB.