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Mulvaney empties consumer watchdog's advisory board

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Mulvaney empties consumer watchdog's advisory board

Acting Consumer Financial Protection Bureau Director Mick Mulvaney cleared its advisory group June 6, pledging to reboot the statutorily mandated panel of industry stakeholders in a smaller format.

Current members of the Consumer Advisory Board were told that they will not be allowed to apply to the new boards and councils.

Emptying the advisory group has sparked fears that Mulvaney may be trying to shrink the voice of community activists that previously used the Consumer Advisory Board to provide direct input on consumer protections.

"There's definitely a concern that the new groups will be skewed and focused," said Ann Baddour, director at the public interest law center, Texas Appleseed. Baddour is the chair of the Consumer Advisory Board.

In an email to board members, the CFPB said the refresh was part of an effort to improve external engagement. The CFPB expressed concern over a lack of town halls and argued that the costs of maintaining the Consumer Advisory Board were too expensive.

By charter, the board is estimated to have an annual operating cost of about $500,000. Advisory board members are not compensated but are entitled to travel expenses.

In a statement, CFPB spokesperson John Czwartacki said the agency had not "fired anyone," adding that members of the board seem "more concerned about protecting their taxpayer-funded junkets to Washington, D.C., and being wined and dined by the Bureau than protecting consumers."

Baddour said she and other members would be willing to pay for their own travel. Judith Fox, a Notre Dame Law School professor who also serves on the board, said in an interview that she had not even been reimbursed for the last meeting. Both Fox and Baddour were part of a team of 11 board members who banded together to voice concerns over the bureau's changes.

Under the Dodd-Frank statute, the CFPB is required to have the Consumer Advisory Board and fill it with experts on a variety of topics ranging from financial services to fair lending and civil rights. By law, members of the board are also required to represent underserved communities and those impacted by higher-priced mortgage loans.

Czwartacki reiterated that the board will continue to meet its statutory obligations. The CFPB has canceled all advisory board meetings through fall 2018, but the board's subcommittees will still operate until the new boards are formed.

On two separate phone calls with advisory board members June 6, Anthony Welcher, policy director for the CFPB's external affairs, said the groups would also be refocused to address specific topics in each meeting. According to Fox, Welcher repeatedly said the advisory board turnover was designed to remove "preconceived notions" that current board members may have.

"It's just an excuse to get rid of us," Fox said.