WASHINGTON, Oct 7 (Reuters) – Examiners at the US Consumer Financial Protection Bureau gave a largely clean bill of health to most of the companies they inspected earlier this year, a light-touch approach that marked a departure from the past for the watchdog, according to three people with knowledge of the matter.
The CFPB resumed examinations in the spring after President Donald Trump’s administration had suspended most of the agency’s work upon taking office last year.
More than half of those exams went through an “expedited review,” which means supervisors identified at most only minor lapses with little risk of harm to consumers, making penalties unlikely, the people said.
Such reviews are more lenient and were historically rare, said the people. But the agency’s new political leadership had made it clear via policy changes and other communications that thorough scrutiny was unwelcome and that examiners’ jobs were at risk, they added.
The high proportion of expedited reviews, which Reuters is reporting for the first time, could expose consumers to harm if the agency overlooked or minimized serious problems, supervisory experts and former agency officials said.
It also shows how the administration’s effort to cut federal workers, narrow exams, and encourage companies to report officials they feel are too tough on them is reshaping frontline oversight of the financial industry, they added.