Consumer Financial Protection Bureau head Richard Cordray defended his agency's plan to collect financial data on 10 million consumers.

Consumer Financial Protection Bureau head Richard Cordray defended his agency's plan to collect financial data on 10 million consumers as necessary and appropriate in testimony today before the U.S. Senate Committee on Banking, Housing and Urban Affairs.

The data, which include information on consumers' credit card use, mortgage payments and other financial transactions, "is widely available, widely used" and anonymous, Cordray said. "The notion that we are tracking individual consumers or somehow invading their privacy is quite wrong." He stressed that the agency needs the information to understand market trends and write reports to Congress.

The testimony - the 32nd time an official from the new agency has appeared on the Hill - was to present the CFPB’s semi-annual report to the Senate. However, Cordray won’t be making an equivalent appearance before the House. In an April 22 letter, Financial Services Committee Chairman Jeb Hensarling (R-Texas.) told Cordray he won’t be invited because his recess appointment is invalid - therefore he’s not really the director of the agency.

Republican members of the Senate banking committee focused many of their questions on data collection. Senator Mike Johanns (R – Neb.) called it “downright creepy” and a “very uncomfortable situation for your agency.” 

Senator Mike Crapo (R – Idaho) added that the “bureau was founded to watch out for American consumers, not to watch them….Although I understand the need to collect data, I’m very concerned about the heavy hand of the government.”

Crapo also questioned whether it was legal under the Dodd-Frank Act that created the CFPB for the agency to collect personal information about consumers.

Cordray pointed out that when consumers file complaints with the agency, they provide personal information like their names and addresses. “That’s voluntary,” Crapo said, and asked for a legal analysis of the data collection.
http://legaltimes.typepad.com/blt/2013/04/consumer-agency-chief-defends-data-gathering.html#more