Two Republican members of the House Financial Services Committee, Randy Neugebauer and Mick Mulvaney, have sent a letter to Director Cordray asking him to convene a forum or roundtable of state and tribal officials before the CFPB proposes a payday loan rule.

In the letter, the Congressmen assert that comments made by CFPB officials about the CFPB’s anticipated payday loan rule indicate a “disregard for state and tribal sovereignty and the existing state-based regulatory framework.”  In particular, they note “concerns with the Bureau’s efforts to preempt state laws by setting a federal legal floor.”  They challenge Director Cordray for “refus[ing] to concede that [the CFPB] will be preempting any state laws” when he appeared before the House Financial Services Committee last month.  They quote Director Cordray’s statement to the Committee that “preemption is when the federal government overrides state law and invalidates state law” and assert that “by setting a federal legal floor, [the CFPB] will override and invalidate state laws that are less restrictive than [the CFPB’s] federal legal floor.”

The Congressmen want the CFPB to hold a forum or roundtable “to ensure that the perspective of state and tribal officials [is] adequately considered” before the CFPB issues a proposed payday loan rule.  They assert that the CFPB has failed to adequately engage state and tribal officials to hear their concerns and that the forum “will ensure that the Bureau carefully considers the perspectives of these officials as it relates to market trends, access to credit issues, and state regulatory models and experiences.”  According to the Congressmen, it would be “irresponsible and disrespectful to the principles of the 10th Amendment of the United States Constitution” for the CFPB to move forward with a proposed rule before holding such a forum.