Sen. Elizabeth H. Warren (D.-Mass.) and Sen. Brian E. Schatz (D.-Hawaii) have proposed the Freedom From Equifax Exploitation Act, but the real exploitation is Warren and her co-sponsor leveraging Equifax’s breach of personal information to expand the reach of Warren’s own creation: the Consumer Financial Protection Bureau.
For people, who have not heard of the CFPB, this rogue agency has morphed from its original intention of protecting consumers to becoming an agency that fights for powerful interests under the guise of consumer protection.
According to Forbes:
[The CFPB] has issued contentious rules, tortured data to make other rules, engaged in an extravagant spending spree, and even found itself blasted by the Government Accountability Office (GAO) for employment discrimination. Nobody has ever made a strong case that the pre-Dodd-Frank framework failed, much less that a new federal agency was necessary to protect consumers. CFPB advocates act as though there would be no consumer protection in financial markets without this government agency, but that’s demonstrably false.
Warren’s FREE Act would open the door to excessive regulation of a credit industry that provides a critical service to the markets.
The FREE Act mandates that credit agencies provide credit freezes and unfreezes free of charge, in addition to a number of other huge regulatory increases.
The bill seems innocent enough on the surface, but the broader intentions of Warren’s bill take a bit of deeper digging to find.
Warren has said she is intent on transforming the entire industry and the ultimate goal argued that this whole industry should be completely transformed,” she didn’t mean it lightly. This is simply the first of many steps in a federal takeover of the financial reporting industry.
If many Americans no longer trust Equifax with their personal information, then they would be no wiser to trust the federal government with their personal information.
Only the federal government and crony capitalist lobbyists, not consumers, will benefit from this new legislation.
After what was undoubtedly a horrific breach of consumer privacy, something must be done. Conservatives should support a free market-oriented solution to this problem, instead of an ineffective left-wing power grab.
Luckily, we already have an example to follow.
Pennsylvania lawmakers have proposed a more balanced bill, PA House Bill 1847, that could serve as a model for federal law. The bill outlines specific policies for dealing with credit breaches, and requires that credit agencies affected by a breach provide free credit monitoring for three years.
This is a smarter solution because instead of blanketly forcing all credit agencies to provide free credit monitoring, under the stern supervision of the CFPB no less, it incentivizes credit companies to increase their security and avoid a costly breach.
House and Senate Republicans need to vote down Warren’s the FREE Act, and introduce conservative legislation at the federal level that gives power back to the consumers, instead of to the bloated CFPB.