After Bank of America announced its $5/month fee for the use of its debit card service, many consumers lambasted the banking giant. But consumers aren’t the only ones blasting BofA. President Obama says “that banks do not have an “inherent right” to a certain amount of profits,” according to The Hill.

“You don’t have some inherent right just to get a certain amount of profit if your customers are being mistreated,” he said in an interview with ABC News. “My hope is that you’re going to see a bunch of the banks saying to themselves, ‘You know what, this is not good business practices.’”

Will the CFPB be cracking down on BofA’s $5 fee? That still remains to be seen.

According to The Hill: “… no officials from the relatively new bureau have indicated the agency would be cracking down on the fee.”

The CFPB is getting it from all angles and is even facing a congressional appropriations bill that could gut its funding. The House Appropriations Committee yesterday released its fiscal 2012 appropriations bill for financial services, and it includes several efforts to curb the CFPB, according to the Hill. The measure is scheduled to be marked up by the relevant subcommittee today.

All told, the $19.9 billion in funding included in the bill is nearly $2 billion below last year’s level and $6 billion below the president’s budget request, the committee said.

“This bill exemplifies the commitment of the Republican majority to reduce spending, dig our nation out of record deficits, and rein in unnecessary agency regulation and interference that obstructs economic growth. The funding in this bill is below the pre-stimulus, pre-bailout levels of 2008, and important provisions are included to prevent government overreach in a variety of areas,” said committee Chairman Hal Rogers (R-Ky.).

Notably, the bill would bring the CFPB’s budget under the purview of appropriators starting in 2013. Currently, its funding falls outside the reach of lawmakers, as it receives transfers from the Federal Reserve to fund its operations.

The measure would also cap mandatory funds for the CFPB at $200 million — the current limit is $600 million.

Treasury Secretary Tim Geithner shunned the GOP for starving regulatory agencies “and using the confirmation process to block appointments to gain leverage in shaping the rules under the Dodd-Frank law.” Geithner, in a speech given at the International Monetary Conference today in Atlanta, said:

“It won’t be successful and the attempt will risk greater damage,” he said.

Tomorrow before the House Subcommittee on TARP, Financial Services and Bailouts of Public and Private Programs, Elizabeth Warren is expected to dispel the myth that new agency she’s building is too powerful.

“I have been told that if you say anything in Washington often enough, it is eventually treated as fact – regardless of whether it is true or false,” she will say. “While making baseless claims might be shrewd tactics for those who want to undermine the bureau’s work, they are flatly wrong.”

To read more about Warren’s planned testimony, click here.

The rules or the director?  That’s the question for the CFPB.  The U.S. Chamber of Commerce is urging Geithner not to allow the new bureau to issue regulations without a permanent director in place.

The Hill also has coverage.

Makes the Payday Pundit sad to see this, but banks and credit unions are blaming each other for scuttling federal legislation to better help credit unions compete with banks.    This article in The Hill newspaper says the bill also helps credit unions provide “alternatives” to payday loans.  From the article:

The bill would allow credit unions to offer alternatives to payday loans and to expand their geographic reach. But banks complain that, due to an overbroad definition of so-called “underserved areas” by the credit union regulator, credit unions would have free rein to lend throughout broad geographic areas like Washington, D.C., Philadelphia and Houston without requirements to serve low-income consumers.

Business loans made in such areas would be exempt from the usual credit union caps on business lending.

“They would have the ability to make unlimited business loans from Northwest Washington, D.C.,” said the vice president of congressional affairs for the Independent Community Bankers of America (ICBA), Ron Ence.

How convenient for credit unions that shortly after payday lending was effectively banned in the District of Columbia, they may get federal legislation to step into the short-term loan market in places like the District.   As the saying goes, as cynical as you are, it’s hard to keep up.