CFPB Requests $0 Budget, Will Draw Down Reserves Instead

The Trump-appointed acting director of the Consumer Financial Protection Bureau is requesting no money to fund the bureau for the current quarter, saying it can tap reserves in a move that will "serve to reduce the federal deficit."

Mick Mulvaney, the White House budget director who serves as the CFPB's interim chief, told the Federal Reserve on Wednesday that the bureau's projected expenses of $145 million for the January-March quarter will be covered by a reserve fund it keeps with the Fed, which totaled $177 million at the beginning of the fiscal year in October.

"The bureau is requesting $0," Mr. Mulvaney wrote in a letter to Fed Chairwoman Janet Yellen.

The CFPB receives funds for its budget from the Fed based on requests from its director and isn't subject to budgetary oversight by Congress. The agency's opponents have long criticized the system, saying an independent budget gives the agency too much power and Congress should control its funding.

The bureau's previous leadership maintained the reserve fund to address possible financial emergencies, but Mr. Mulvaney said he knows of no specific statutory authority, or practical reason, to maintain such a reserve. Mr. Mulvaney said he would spend the reserve further before making a budget request from the Fed.

A CFPB spokesman said the 1,600-employee agency will be "as efficient as possible" with the money it is allocated.

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(END) Dow Jones Newswires

January 18, 2018 11:27 ET (16:27 GMT)