Consumer Financial Protection Bureau Acting Director Mick Mulvaney will not request funding from the Federal Reserve Board to cover the bureau’s operating expenses in the second quarter of 2018, according to a letter sent to Fed Chair Janet Yellen yesterday. Instead, Mulvaney said that he intends to use money from the bureau’s reserve fund at the Federal Reserve Bank of New York to cover the CFPB’s second quarter operating expenses, which are estimated at $145 million.
The bureau’s reserve fund — which contains $177.1 million — was maintained by previous CFPB leadership for emergencies, but was never used. Mulvaney noted that there appears to be no statutory requirement for the establishment or maintenance of such a reserve, and added that holding such a significant sum in reserve is unnecessary, as “the [Federal Reserve] Board has never denied a bureau request for funding and has always delivered requested funds in a timely fashion.”
Mulvaney added that he will “spend down the reserve until it is of a much smaller size, while still allowing the bureau to successfully perform its functions, before making an additional financial request of the board.”
The existence and size of the bureau’s reserve fund was not, until now, publicly recognized. ABA continues to advocate for greater transparency and stronger oversight of the CFPB, and has previously expressed its view that the bureau should be led by a bipartisan commission rather than a sole director and subject to the annual congressional appropriations process.