On July 15 and July 16, the House Financial Services Committee and the Senate Banking Committee, respectively, held hearings on the CFPB’s semi-annual report to Congress, with Acting Director Russell Vought testifying at both for the first time since assuming the role. The hearings came as Vought’s tenure as acting director nears an end. As previously covered by InfoBytes, President Trump nominated Brian Johnson to serve as director, and the Senate Banking Committee has since scheduled a confirmation hearing for July 23. In prepared testimony delivered at both hearings, Vought asserted that, upon taking over the agency, he found that the agency was “weaponized, out-of-control, and had gone far beyond its statutory mandate,” and, while taking credit for improving how the agency operates, he said it still “remains structurally defective” and should be made subject to the appropriations process to “legitimize an otherwise unserious agency.” He also said the Bureau is close to issuing a proposed rule under Section 1033 of the Dodd-Frank Act on open banking and consumer data access, though he would prefer to leave its finalization to a Senate-confirmed director.

At the House hearing, Committee Chairman Rep. French Hill (R-AR) said the Bureau had moved away from regulation by informal guidance toward “a disciplined approach grounded in clear rules,” warning that a future director could reverse course “with the stroke of a pen” absent further reform. Other Republican members called for legislation reducing duplicative examinations with prudential regulators and narrowing the Bureau’s rulemaking discretion. Ranking Member Rep. Maxine Waters (D-CA) countered that the Bureau had returned billions of dollars to consumers before Vought’s tenure and argued that Vought had directed it to drop enforcement actions and block funds from being returned to harmed consumers, which Vought attributed to legal theories adopted by prior Bureau leadership that he believes exceed the Bureau’s statutory authority. Democratic members raised additional concerns about staffing and funding cuts, the scope of Vought’s authority as an acting director, and public access to the Bureau’s consumer-facing resources.

At the Senate hearing the following day, Committee Chairman Sen. Tim Scott (R-SC) said that “a new day at the CFPB” means the Bureau respects the limits of its authority and follows its mandate rather than pursuing an ideological agenda, crediting Vought with reining in the agency’s overreach. Other Republican members embraced Vought’s view of placing the Bureau’s funding under congressional appropriations and reducing the risks of concentrating regulatory authority in a single director. Ranking Member Sen. Elizabeth Warren (D-MA) and other Democratic members raised concerns about, among other things, staffing and funding cuts affecting the Bureau’s supervision, enforcement, and servicemember protection functions, and about recent restrictions added to the Bureau’s consumer complaint portal, which Vought attributed to a surge in submissions tied to bots and credit repair companies.