I am not of the habit to call attention to the work of my competitors in the financial media – after all, what have they done for me lately? But good work deserves praise, and I want point out a March 6 article by Rachel Witkowski of American Banker that spotlighted some rather astonishing behavior at the Consumer Financial Protection Bureau (CFPB).
What happened in Cordrayland? Well, according to confidential personnel data obtained by Witkowski, it appears that the bureau is maintaining a human resources policy where white employees receive conspicuously higher performance reviews than their African-American, Asian-American and Hispanic counterparts. And this is not a situation where a few malcontent employees channel Al Sharpton for some inane race card playing – CFPB employees have filed 115 grievances with the National Treasury Employees Union since last August, with pointed complaints regarding inequality in pay and performance reviews.
One CFPB employee, speaking under the cloak of anonymity, noted the disconnect between the CFPB’s mission and its internal practices. “The level of hypocrisy at this agency is shocking,” said the staffer in the American Banker article. “If it was a lender and had similar statistics, it would be written up, immediately referred to the Justice Department, sued and publicly shamed.”
At one level, this is fairly shocking news. But at another level, it appears to be par for the CFPB course. Indeed, the CFPB mantra appears to be “Do as I say, not as I do.” And while the bureau’s architects smugly insisted that it would serve as a “cop on the beat,” they have no problem with the concept of being a cop that routinely abuses authority.
Perhaps the most obvious bit of arrogant recklessness involves the ballooning budget of the CFPB’s headquarters in Washington. The 1,200-member bureau is supposed to be located in a 1970s-era office building that once housed the Office of Thrift Supervision. But the CFPB felt that the building needed renovation, and the original budget for the upgrade was $55 million.
Last summer, however, the renovation budget soared to $95 million. The Washington Examiner reported that the $95 million figure was nearly double the $50 million annual budget for that the General Services Administration (GSA) set aside for the acquisition, construction and upgrading of all federal property.
On January 28, CFPB top banana Richard Cordray blithely informed a House of Representative hearing that the costs of renovation for his bureau’s headquarters went up again – it is now at $145 million. Rather than show leadership and take responsibility for the problem, Cordray dumped the blame for the cost overruns on the GSA and expressed impatience at the suggestion that his agency was wasting taxpayer money.
“The notion that we would try to build some palace that we don’t even own or control doesn’t make much sense to me,” Cordray said.
The “palace” crack is rather amusing, considering that the renovation is being coordinated by Skidmore, Owens and Merrill, the architectural firm behind Dubai’s soaring Burj Khalifa – hey, what’s good enough for an emirate is good enough for the CFPB, yes? And while the Dodd-Frank Act requires the CFPB to be headquartered in the District of Columbia, local architects were not part of the master plan – Skidmore, Owens and Merrill are based out of Chicago, which just happens to be the home of a certain sitting president.
However, the CFPB HQ renovation is nowhere near finished, and the agency is now spending $22.3 million to lease temporary headquarters for the next two years. In case you are wondering who is the landlord receiving all of those millions, it is an Obama campaign bundler and crony named Neil G. Bluhm. Hmmm, and I thought the CFPB was supposed to function separate and apart from the White House.
Whether or not Cordray and friends are working in a “palace” can be debated, but the CFPB squad – or at least the white employees in the bureau, according to internal personnel data – seem be enjoying Dubai-worthy salaries. According to Washington Examiner research that was first published last year, 56 CFPB employees enjoy annual salaries that are higher than the $199,700 earned by Fed Chairwoman Janet Yellen, while 19 CFPB employees earn salaries higher than the $223,500 received by Chief Justice John Roberts. Furthermore, 14 CFPB staffers have salaries that exceed the $227,000 earned by Vice President Joe Biden.
Funny, but I was under the impression that “Financial Protection” was the CFPB’s middle name. Who is being protected by this bureau? Certainly not the non-white employees that work for this entity. And certainly not the taxpayers who are footing the bill for extravagant headquarters, overpriced “temporary” offices and salaries that are among the highest in the federal government.
Before Cordray and his attack dogs begin to badmouth the financial services industry for any perceived faults, perhaps they should start making amends for their own insensitivity, carelessness and waste. If these situations prove anything, it would be that the CFPB is strictly in the business of protecting its own venal self interests.
About The Author
Phil Hall has been (among other things) a United Nations-based radio journalist, the president of a public relations and marketing agency, a financial magazine editor, the author of six books and a horror movie actor. Also, as you will discover, he is not shy about stating his views.