These members of the ‘government within the government,’ as The New York Times‘ John Tierney describes them, produce one freedom-restricting, economy-hindering rule after another without much oversight.
Veronique de Rugy writes: The tyranny of the administrative state is real and hard to tame. Americans would be horrified if they knew how much power thousands of unelected bureaucrats employed by federal agencies wield. These members of the “government within the government,” as The New York Times‘ John Tierney describes them, produce one freedom-restricting, economy-hindering rule after another without much oversight. These rules take many forms, and few even realize they’re in the making — until, that is, they hit you square in the face.
Take the Consumer Financial Protection Bureau’s rule that effectively banned car dealers from giving auto loan discounts to customers on the claim that they might lead to racial discrimination (a dubious conclusion reached using flawed statistical models). Dodd-Frank, the legislation that created the CFPB, prohibited it from regulating auto dealers — so the CFPB quietly put out a “guidance” document to circumvent due process and congressional oversight.
Thankfully, this time around, someone noticed. In recent weeks, the Senate passed a resolution of disapproval under the Congressional Review Act — a streamlined procedure for Congress to repeal regulations issued by various federal government agencies. The House is expected to follow suit soon and send the bill to the president’s desk, if it hasn’t already by the time you read this. Read the rest of this entry »
‘Wells Fargo employees secretly opened unauthorized accounts to hit sales targets and receive bonuses.’
Matt Egan reports: Wells Fargo said on Thursday it fired 5,300 employees for creating ghost accounts over the past five years without the knowledge of customers. Regulators allege millions of these bank and credit card accounts were opened.
“Everyone hates paying bank fees. But imagine paying fees on a ghost account you didn’t even sign up for.”
That’s exactly what happened to Wells Fargo customers nationwide.
On Thursday, federal regulators said Wells Fargo employees secretly created millions of unauthorized bank and credit card accounts — without their customers knowing it — since 2011.
“The scope of the scandal is shocking. An analysis conducted by a consulting firm hired by Wells Fargo concluded that bank employees opened up over 1.5 million deposit accounts that may not have been authorized.”
The phony accounts earned the bank unwarranted fees and allowed Wells Fargo employees to boost their sales figures and make more money.
“Additionally, Wells Fargo employees also submitted applications for 565,443 credit card accounts without their knowledge or consent, the CFPB said the analysis found.”
“Wells Fargo employees secretly opened unauthorized accounts to hit sales targets and receive bonuses,” Richard Cordray, director of the Consumer Financial Protection Bureau, said in a statement.
Wells Fargo confirmed to CNNMoney that it had fired 5,300 employees related to the shady behavior. Employees went to far as to create phony PIN numbers and fake email addresses to enroll customers in online banking services, the CFPB said.
“Many customers who had unauthorized credit cards opened in their names were hit by annual fees, interest charges and other fees.”
The scope of the scandal is shocking. An analysis conducted by a consulting firm hired by Wells Fargo concluded that bank employees opened up over 1.5 million deposit accounts that may not have been authorized, according to the CFPB. Read the rest of this entry »
[VIDEO] Operation Choke Point Was Meant to Stop Fraud. So Why is the Program Going After Legitimate Business?Posted: September 6, 2015
The Government’s Secret War on Small Business
Banks are sending notices of account closure out to small businesses across the country, to clients they’ve done business with for years, even decades. The reason? They often don’t provide one.
But a growing number of business owners believe they know why they’re being cut off from the financial system. It’s Operation Choke Point, ostensibly an attempt to crack down on fraudulent businesses, but in reality a dragnet that has ensnared innocent entrepreneurs unfairly classified as “high-risk” players.
Earlier this year, Federal Deposit Insurance Corporation (FDIC) chairman Martin Gruenberg told Congress that Choke Point was over, but many business owners believe the FDIC and the Department of Justice have passed enforcement duties along to a newly created independent agency: the Consumer Financial Protection Bureau (CFPB), the brainchild of progressive senator Elizabeth Warren (D-Mass.). The CFPB operates under the guidance of the Federal Reserve and doesn’t rely on Congress for funding, which critics say allows it to operate without any meaningful checks on its power.
Reason TV profiled two business owners who believe they’ve been targets of Choke Point and its legacy: a payday lender in Southern California and a hookah seller in North Carolina. Brian Wise of the U.S. Consumer Coalition, an organization that’s been compiling Choke Point stories from across the nation, also appears in the video. Read the rest of this entry »
Happy times are here again! Republicans have won the Senate, and they surely won’t screw it up this time. Right?Posted: November 9, 2014
The GOP Senate: A New Utopia Dawns
P.J. O’Rourke writes: Like all good Republicans, I’m so happy I could frack the moon. I could drone strike the Dodd-Frank Wall Street Reform and Consumer Protection Act, I’m flying that high. I’m feeling good enough to lay 1,179 miles of pipe with my honey-bunny Keystone XL. And now that the GOP has bedded the House andthe Senate, she is, ahem, about to come – delivering crude oil from Canada to the Gulf Coast and all the wetlands, wilderness areas, and sensitive eco-systems in between.
“Extraordinary things occurred the last time Republicans took legislative power away from a liberal quack…”
And that’s just the beginning of the wonderful events that are about to transpire. This is more exciting than the Newt Gingrich congressional triumph of 1994. Obama is a bigger sitting duck than Clinton. And Obama is a lame duck too. No Democratic Senate or House candidate was sitting in the voter blind with Hope and Change decoys on the electoral pond calling, “Barack! Barack! Barack!” Even the Dems ducked Obama.
“To sum those things up in just two words, which still stir the heart of every right-thinking member of the Grand Old Party: Monica Lewinsky. Was that fun or what?”
And there was the Contract with America, with its balanced budget and term limits Constitutional Amendments and its Personal Responsibility Act to discourage having children out of wedlock.
In 1993, 27 percent of American children were illegitimate. Now it’s, um, about 40 percent. But, come on, what kind of self-respecting Republican writes a contract that he can’t wiggle out of with the help of lawyers? And practically everyone in Congress is one. Read the rest of this entry »
— Lachlan Markay (@lachlan) August 12, 2014
Too Convoluted to Succeed
Nicole Gelinas writes: Five years ago this September, the Lehman Brothers investment bank collapsed. Markets around the world froze until Western governments devised a massive bailout plan that kept investors from pulling trillions out of the global financial system and precipitating a worldwide depression. The financial crisis helped propel Barack Obama to the presidency. In his inaugural address, Obama said that the crisis was a reminder that “without a watchful eye, the market can spin out of control.” After the February 2009 stimulus law and the March 2010 “Obamacare” health-insurance overhaul, the Dodd-Frank financial-reform act of July 2010—meant to sharpen the vision of that “watchful eye”—became Obama’s third signature legislative victory. “The American people will never again be asked to foot the bill for Wall Street’s mistakes,” Obama said as he signed the bill into law. “There will be no more tax-funded bailouts—period.” To applause, he added that “there will be new rules to make clear that no firm is somehow protected because it is ‘too big to fail.’ ”
But three years later, “too big to fail” lives on. “There’s a growing bipartisan consensus that the Dodd-Frank Act regrettably did not end the ‘too-big-to-fail’ phenomenon or its consequent bailouts,” Texas congressman Jeb Hensarling, head of the House financial-services committee, said just before Dodd-Frank’s third anniversary this summer. Republicans aren’t the only ones saying so. Elizabeth Warren, the new Democratic senator from Massachusetts, recently introduced her own “end too big to fail” bill, implicitly suggesting that Dodd-Frank did not fix the problem. At one congressional hearing after another, independent expert witnesses, as well as top officials from the Obama administration, have admitted that there is still no structure in place that would allow large financial institutions to go under without risking an economic meltdown. What went wrong with Dodd-Frank, and how can the problems be fixed? Read the rest of this entry »
After Senator Elizabeth “Pocahotmess” Warren spoke at a luncheon in Beverly Hills, Calif., last month, women from the audience swarmed around her, many of them asking the same question: will you run for president? Read the rest of this entry »
By Ramesh Ponnuru – May 27, 2013
Whatever the investigation into misconduct at the Internal Revenue Service reveals, we already have all the evidence we need to understand President Barack Obama’s fundamental attitude toward the rule of law. That evidence is right there in the public record, and what it shows is indifference and contempt.
The Constitution gives the president the power to appoint officials to fill vacancies when the Senate isn’t in session. In 2012, Obama made such “recess appointments” to the National Labor Relations Board and the Consumer Financial Protection Bureau — even though the Senate had stayed in session precisely to keep him from doing so.
Obama’s lawyers argued that the Senate wasn’t really in session even though it claimed to be: It was going through the motions to block Obama, but it wasn’t taking up bills or nominations. No previous president had ever tried this maneuver, and an appeals court has just ruled that it was unconstitutional.
The Patient Protection and Affordable Care Act, the sweeping health-care law that Obama signed in 2010, asks state governments to set up health exchanges, and authorizes the federal government to provide tax credits to people who use those exchanges to get insurance. But most states have refused to establish the online marketplaces, and both the tax credits and many of the law’s penalties can’t go into effect until the states act.
Obama’s IRS has decided it’s going to apply the tax credits and penalties in states that refuse, even without statutory authorization. During the recent scandal over the IRS’s harassment of conservative groups, many Republicans have warned that the IRS can’t be trusted with the new powers that the health law will give the agency. They are wrong about the verb tense: It has already abused those powers…
…More via Bloomberg