Outgoing CFPB Employee Says Agency Leadership is Undercutting Staff

A federal employee at the CFPB had some harsh outgoing words in his resignation letter for the agency’s acting director.

A resignation letter sent by an employee at the Consumer Financial Protection Bureau to acting director Mick Mulvaney had some harsh outgoing words about leadership at the agency.

In his resignation letter (included below), Seth Frotman, the CFPB’s assistant director and student loan ombudsman, said that leadership at the agency “has repeatedly undercut and undermined career CFPB staff working to secure relief for consumers.”

While he said it has been “an honor” to work at the agency, Frotman said he was regrettably tendering his resignation, but added, “Unfortunately, under your [Mulvaney’s] leadership, the [Consumer Financial Protection] Bureau has abandoned the very consumers it is tasked by Congress with protecting.”

Frotman cited some of the changes he felt were negative ones, including what he described as “misguided goals by the Trump administration to the detriment of student loan borrowers” and also allegations that leadership at the agency suppressed a report prepared by agency staff reportedly showing that “the nation’s largest banks were ripping off students on campuses across the country by saddling them with legally dubious account fees…”

Frotman has served in the position for the last three years, one that was created by Congress in 2010.

“The Student Loan Ombudsman provides assistance to borrowers and potential borrowers to resolve questions or issues involving student loans,” according to the CFPB’s website.

Salaries at CFPB

The agency’s budget and salary structure are different than those of most other federal agencies. Congress cannot set its budget or enact reforms at the agency due to restrictions in the Dodd-Frank Act.

The salaries of employees who work there do not have to conform to the General Schedule (GS) pay scale, often resulting in much higher salaries. Frotman’s annual FY 2017 salary at the CFPB was $198,817 according to the latest available data on FedsDataCenter.com. The average salary at CFPB in FY 2017 was $132,965; the median salary was $128,275.

Politics and the CFPB

The agency has seen some tumultuous changes since the last presidential election, including a lawsuit over who got to lead the agency after its former director left.

The Trump administration maintained it had the right to nominate an acting director, but former agency employee Leandra English, who was nominated by the previous director to lead the agency, sued to maintain her leadership position. She has since resigned and dropped the lawsuit.

Acting agency head Mick Mulvaney has also asked Congress to limit the power of the agency in a recent report to Congress.

Seth Frotman Resignation Letter by FedSmith Inc. on Scribd

About the Author

Ian Smith is one of the co-founders of FedSmith.com. He has over 20 years of combined experience in media and government services, having worked at two government contracting firms and an online news and web development company prior to his current role at FedSmith.