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U.S. financial watchdog lifts hold on collecting consumer data

U.S. financial watchdog lifts hold on collecting consumer data
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WASHINGTON (Reuters) – The chief of the U.S. watchdog for consumer finance on Thursday said he would allow the agency to collect customer data when it investigates cases of possible fraud, removing an obstacle that he had put in place last year.

Mick Mulvaney, the acting director of the Consumer Financial Protection Bureau and head of the White House budget office, said he is confident that the agency can safeguard personal consumer data as it polices lending markets.

Mulvaney ordered the CFPB to stop collecting consumer data when he took over at the agency in late November. Consumer advocates had said the move would leave investigators hamstrung as they tried to root out cases of possible wrongdoing.

CFPB officials have typically relied on consumer data to help investigate and build cases.

Mulvaney said he had been concerned that consumer data could be stolen if the CFPB were hacked. But in tests of CFPB computer systems, Mulvaney said, the agency was able to reliably protect consumer data.

“This process has been an important exercise in holding ourselves to the same high standards to which we hold the entities we oversee,” Mulvaney wrote to staff in an email.

The CFPB was conceived in 2010 to protect consumers from exploitative loans. In November, Mulvaney was tapped by President Donald Trump to lead the agency on an interim basis.

As a Republican congressman, Mulvaney said the CFPB was unnecessary and put a crimp in lending markets. As head of the agency, Mulvaney has dropped investigations into several high-cost lenders and said the agency should ease the burden on industry.

(Reporting by Patrick Rucker; Editing by Steve Orlofsky)

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