The Senate, exhibiting their bipartisan nature, voted in favor of overturning a new rule from the Consumer Financial Protection Bureau (CFPB) despite President Biden threatening to veto. This rule would have required small business lenders to collect and report intrusive demographic data, posing concerns about privacy, data security, discrimination, and potential lawsuits. The CFPB’s attempt to expand data collection under Section 1071 of the Dodd-Frank Act was met with opposition from Senator John Kennedy, who filed a resolution to invalidate the rule.
Senate votes to overturn CFPB small business rule as Biden threatens veto https://t.co/zNuDtZxnEj
— POLITICO (@politico) October 18, 2023
Kennedy, in his passionate floor speech, criticized the CFPB for perverting Congress’ initial intentions with an excessive influx of data requirements. He astutely drew attention to the invasive questions that lenders would be forced to ask regarding an applicant’s race, ethnicity, and gender identity. This private information would then be posted on the CFPB’s public website, exposing applicants to potential discrimination and further burdensome compliance costs for financial institutions. Kennedy aptly argued that the CFPB had no business interfering in the private lives of Americans.
After successfully passing the resolution through the Senate, Kennedy called upon the leaderless House to act swiftly. He expressed concern over the additional burden the CFPB’s rule would place on struggling small business owners, exacerbated by President Biden’s inflationary policies. Unfortunately, with the House currently lacking a Speaker, it appears that progress on this resolution and other pending legislation is unlikely.
Unsurprisingly, the White House issued a statement strongly opposing the Senate’s resolution. They claimed its passage would hinder transparency and accountability in small business lending, disregarding the very real concerns about privacy and discrimination. Consequently, President Biden has pledged to veto the resolution if it reaches his desk, displaying a disregard for the interests and well-being of small business owners.
This is just another example of overreach by a government agency, the CFPB, attempting to intrude upon the private lives and businesses of Americans. It’s clear that this rule would have placed unnecessary burdens on financial institutions and jeopardized the privacy of loan applicants. The Senate’s action to repudiate this overreach is commendable, especially considering the looming veto threat from President Biden. It’s crucial that our elected officials continue to prioritize the protection of privacy and individual liberties over bureaucratic demands.