Imagine if the Consumer Financial Protection Bureau’s Board of Trustees was appointed by industry sponsors who paid a $7,500 fee.
In this scenario, the majority of the board would be required to be industry creditors. The board would also appoint the agency’s rule-writing staff — and they would be creditors, too.
The staff wouldn’t have to give up their industry perches while they wrote rules, and the rules they wrote would not only set the standards for industry practices, but also the criteria for entering it. The rules would be adopted in all 50 states.
That was the startling and totally hypothetical analogy made, based on the current structure of the Appraisal Foundation, in a scathing report released this week.
The report, commissioned by the Appraisal Subcommittee and led by the National Fair Housing Alliance, found that the appraisal industry, in sharp contrast to other sectors in housing finance, has been allowed to regulate itself.