Democrats press Trump to replace Mulvaney as CFPB head

What you need to know about the CFPB
What you need to know about the CFPB

Senate Democrats aren't wasting any time in pressuring President Trump to replace Mick Mulvaney as head of the Consumer Financial Protection Bureau.

In a letter sent to Trump Monday, 44 senators in the Democratic Caucus demanded the president nominate a director to the agency who has "a track record of being tough" on Wall Street and other financial firms that rip off consumers.

Senators Heidi Heitkamp, Joe Manchin and Claire McCaskill were the only three Democrats in the Senate who did not sign on to the letter seen by CNN. Angus King, an independent and a member of the Democratic Caucus, also refrained from signing it. Representatives from their offices did not respond to requests for comment.

Spearheaded by Sherrod Brown, the ranking member of the Senate Banking Committee, and Sen. Gary Peters, the letter was sent in response to Trump's decision to name Office and Management Budget Director Mulvaney to temporarily lead the CFPB. Trump made the appointment on November 24, shortly after the previous director Richard Cordray announced it would be his last day at the federal government's controversial consumer watchdog agency.

Related: Republicans say CFPB is crippling the economy. Really?

Proponents of the agency argue naming Mulvaney, who worked to kill the agency while he served in Congress, signals Republicans are still out to dismantle it.

In their letter, Democrats described Mulvaney's appointment under the Federal Vacancies Reform Act as tantamount to "political interference" of an independent agency by the White House. They said the move would jeopardize the work of the bureau.

"Assigning leadership of the CFPB to someone who already has a full-time job reporting to the White House and who does not believe in the CFPB's mission jeopardizes the agency's independence and effectiveness," the senators wrote.

Democrats argue the agency has worked to helped millions of Americans who have been ripped off by mortgage schemes or taken advantage of by predatory financial firms. Actions by the agency have resulted in $12 billion in relief for more than 29 million Americans.

Critics of the agency -- including Mulvaney -- argue the CFPB is the epitome of government overreach and wields too much unchecked power.

Mulvaney has argued the agency is "trampling on capitalism" and has promised to remedy that problem immediately.

Related: Why Wall Street and Republicans hate the CFPB

Since starting the job last Monday, he's already announced a 30-day freeze on new regulations to make sure they are not "choking off" lending.

"Rumors that I am going to set the place on fire, blow it up or lock the doors are completely false," Mulvaney said last week.

But Mulvaney's public distaste for the bureau is raising questions about what will happen to the many open investigations and lawsuits the agency has launched against companies and banks. He's expected to be briefed on roughly 100 lawsuits it is involved in.

Court documents and regulatory filings show these include Wells Fargo (WFC), online real estate firm Zillow (Z) and student loan processor Heartland Campus Solutions. There are likely other ongoing investigations into companies that the CFPB has yet to disclose.

Last week, Democratic Senator Elizabeth Warren called for the agency's inspector general to review several of Muvlaney's early directives, including the 30-day regulatory freeze.

"Mr. Mulvaney provided no clarity on his authority to enact these moratoria, their impact, or how they would be implemented," Warren wrote in a Nov. 30 letter. "For all intents and purposes, Mr. Mulvaney appears to have announced a 30-day shutdown of the CFPB."

--CNNMoney's Matt Egan contributed to this report.

Personal Finance


CNNMoney Sponsors