The Consumer Financial Protection Bureau is going to spend $22.3 million to lease temporary office space for two years in a building controlled by an Obama friend and campaign bundler while the new agency's future headquarters undergoes a $145 million renovation, the Washington Examiner reports. There's a word for what is being done to taxpayers by this agency's real estate deals, and "protection" isn't it.
In a normal world of checks and balances as envisioned by the founders and enacted in the Constitution, Congress would simply refuse to appropriate these funds, and the agency would find some less expensive workspace. But the agency, as created by the Dodd-Frank financial reform bill, is funded not by Congress but by the Federal Reserve. As the director of the CFPB put it in an October 2013 letter to the CFO of the Federal Reserve:
Section 1017(a)(1) of the Consumer FInancial Protection Act ("the act") requires the Board of Governors of the Federal Reserve System ("Board") to transfer to the Bureau of Consumer Financial Protection ("Bureau") each quarter the amount determined by the director to carry out the authorities of the Bureau under Federal consumer financial law and the Act. I have determined that $181,000,000 is the amount necessary to carry out the authorities of the Bureau for FY 2014 Q1, and I request that the Board transfer this amount to the Bureau immediately.
If a legal challenge to the Dodd-Frank Act on the various constitutional grounds (separation of powers, appropriations clause) is insufficient to end this arrangement, Congress itself should step forward and amend the Dodd-Frank Act to require the CFPB's expenditures to be voted on by Congress. Otherwise, there's no accountability. And people might want to remember this situation the next time the SEC's or CFTC's enablers start calling for those agencies to fund themselves rather than rely on Congressional appropriations.