>> that's a good question. i think when the agency started shrinking, there was no creation of a new agency to draw people away. the cfpb that tom alluded to is on a banking scale. so they pay considerably more for people who do some -- who over time will be doing some of the same work that we do. i would think at this point, and thereby appropriations. i don't disagree with commissioner rush, we all understand that we have to do belt tightening, but let's say you're someone who is one of the 450,000 consumer who is got a check in the mail in -- it's hard to say to them, well, we're going to reduce the funding of

the federal trade commission and as a result, you know, it's going to take longer, it's going to take longer to do that investigation, you might not bring this other case. you know, you might not -- $300 for mowing the lawn, putting it on someone's servicing bill and adding late fees and a variety of other fees, it's hard to tell consumers we can't help you. so if over time if the cfpd survives and does the things that i believe it will on behalf of consumers, then i think that's a real debate to have. and i think i would be agreeing with commissioner rush that we would be bringing -- again, the

cfpd, terrific people there, a really good head of the agency. but their future is, i think we all understand, somewhat uncertain, at least in the next year or two and they haven't brought a case yet because they're a new agency. i don't envy you, you have tough choices to make. and we're going to work within those parameters. but what i do know and what i think that commissioner rush agrees with me on is that we're a really good agency. so i respect his position that, you know, we should just stay flat and if that's where you end up, that's what we're going to do, and we're going to do the best we can. >> and i hear what you're saying, and every department that cos the same thing, we're so important, we're so important, we're so important. and i know why -- certainly

there's very important tasks that you take care of. but i left three children, kissed them all this morning, they went off to elementary school, middle school, innocent and unaware of us sitting here today. i'm wondering what you would say to them, they're the ones who are going to have to pay for them. your children and your grandchildren are going to have to pay for this. so the decisions are really not that difficult. they're just delayed because of the -- we as a congress have got to come to grips with this and i think each of us have to do it together. and we're here to call for bipartisanship, this is the opportunity for us all to do it together. going on a fifth year of trillion dollar deficits, is not the path that we need to be on. >> thank you so much.

all right, so we're not going to -- i have a couple more questions, and it has really less to do with the cfpd than it does with you all, but i am curious about this whole process. i don't like duplications at all and it is, i think, a waste of resources and so let me ask this, number one, the 21 folks that went over to cfpb, what did they do? what were their jobs at the ftc were attorneys, some but not all of them did financial fraud issues, for nonbank. >> right, nonbank. >> where we have jurisdiction. and and they were on hold as is

typical of our agency. >> so they were -- were they asked specifically by the cfpb folks that if you want to go over and keep working on these issues, you can go? how did that whole thing transpire? >> so, i think we sent over a couple of detailees early on, just to make sure that folks knew what they were doing on things they didn't inherit. so they took rules from the banking industry, and put them away but they hadn't done what we have done. >> for the most part, nay eve been hired away. >> i'm still confused about why that function is leaving you all. because i don't understand what is it they're going to do that is different from what you all are currently doing? >> i realize there's a little bit of bitterness here.

healthy competition to me is spreading your resources thinner when you all have expertise in this area, it's just silly. >> it's a really fair question to ask. i guess i would say this. if, over time, we have back filled most of those positions, if you include our regional offices, there's sort of 100 people working on financial fraud issues right now. and we have back filled almost all of those positions already. but having said that, i think over time, they might be, you know, a very competent and better agency in the financial fraud area. in the next couple of years, i think you want to make sure that

you're stopping financial fraud. >> i read the mou and i still can't figure out what you're doing versus what they're doing. >> what it does, at its most basic level, it says let's let each other know who we're investigating. it doesn't say you take the payday lenders and we'll take the nonbank -- >> so you're basically duplicating. we have a whole list of characters and they're taking one and you're taking one. why aren't we just leaving it in the ftc, period? >> because none of us has a imagine i believe wand and if we did, we might do things differently. but i would like to think that -- in fact i know, because i look at our complaint database, that this is a very target rich environment. there are more people who are doing bad things to consumers than we can go after. but the other thing is, why

don't we leave it to the federal trade commission? it wasn't a unanimous determination, but they would create this new agency and so we work with it and, you know, i hear what you're saying, i understand your concerns, you know, there was obviously some debate, as you know early on about whether to just make those functions a part of the federal trade commission. >> so the opposite question is, why don't we just send that whole piece of what the ftc does there and you will focus on all of the things that you do well? >> there i would say, i think there are some people who believe overtime that that night happen. but there we had a very bipartisan view, it was joe barton, it was henry waxman, it was barney frank, who was your college classmate and backus, everyone agrees that we should keep our jurisdiction because we

did a really good job and because there was uncertainty very, very early on. so -- >> you were very diplomatic and i understand where you're coming from and i have very little to add to what the chairman has said, except the following. first of all, with respect to the people who have gone over there, peggy toolly, who brought our principal pre2008 case that yielded consumers millions and millions of dollars went over to head up the cfpb's new nonrank financial protection program. second, i would point out, that the cfpb has exclusive jurisdiction over rule making,

over fair debt collection practices. and it may make a rule which is broader than the one that we enforce under the fair debt collection practices act. we don't know. at the present time. the chairman is correct about that. but from my standpoint, it's folly, in this limbo state that the cfpb is in, comment that we know that it's got a lot of our people doing nonbank work and some of our best people. it's folly for us to try and duplicate their efforts today. and particularly in a time of austerity. it doesn't make any sense to me. >> i appreciate that and it is -- i mean the whole thing is kind of frustrating and it's

kind of like on other financial type things you've got the ftc and cftc having to jointly do rules making, which is hard enough among five commissioners, let alone five commissioners in three different committees to agree. where could we easily save money? so we have got seven regional offices, you want to add, you know, a couple of people in an inexpensive place in miami. so is there an atlanta office? >> yes. >> so could the atlantic office -- atlanta office close and become the miami office? >> that would not be -- i think my preference or the preference of most of the members of the commission, although i would talk with them about it.

what i think we would do is we would post -- if we go forward with the miami office, we post for it from within our existing agency. my guess is we would have a lot of people doing that. miami, but i want to think about it. >> new york, chicago, san francisco, dallas-ft. worth and cleveland and seattle. >> do you with technology as it is said, do we need all those regional offices? i would contend that having an

office in miami that's particularly focused on spanish speaking would make sense, but i don't know why you need to have seven other offices. >> you might talk to chairman durbin abouto office. commissioner rush -- [ inaudible ] >> have several usd offices closing in my district and it makes me sad and it makes me angry, because aren't doing what they ought to be doing, but do we need them in this technological era in which we live? >> to the chairman's credit, i champion closing the atlanta office. and he had suggested that he would be at least in some future

incarnation amenable to that as well. but that is something that i do think we ought to consider. >> if we had to start from scratch, and by the way when commissioner rush was we don't want to play havoc trying to close it. >> if we had to start from scratch. i think there's something that these offerses could do ---where they're located and near where they're located, that is it is a little bit -- we want you to have seven regional offices, you pick the cities. i can't imagine that miami would been a city. it's a hub for latin-american

business activity. it's grown exponentially, and so i can't imagine we wouldn't put it there. but at the same time, our regional offices have been really just engines of anti-productivity. i would hate to say we can't -- i would hate to say we would close this office in order to open another office because they're really good people, i don't want to move them, i don't think the commission would want to move them around. but we would do it if you let us do it and again it's up to you, because we would need to do existing reprogramming and we would do it in existing resources. >> if you announce that you're going to open that office in january or february, i know you

will have a lot of people that will want to go down. >> and i wasn't choosing atlanta because mr. graves isl. but i'm trying to figure out, if you need this, what can you do without? because the fact of the matter is that we just don't have any money. >> well, i would say between commissioner rush's testimony and from what we heard memrs of subcommittee we might find a way to do it from existing resources and to try to take some of the points we have heard today. >> indulge me for one more quick question. it has to do with all the lease space and it kinds of brings us up to date on the new jersey avenue location. >> right. >> and i think originally you had asked for more space, more square footage than you all needed. but tell me what you're doing

with this move because obviously i'm looking for another wie to consolidate some space and save sum money. give us an update. >> with respect to this give us an update. >> well, thanks to this subcommittee, we probably have enough money now or very close to it to do our move. i was talking with the executive subdirector about how we are going to new space as part of our belt tightening, reduce the space per employee and per attorney to some extent. >> let me ask you. >> yes. >> do each of your attorneys have to have private offices? >> it is preferred because of the confidentiality and some of the things we do, but it's not essential. and we have doubled up at times in the past. and we might have some doubling going up now and in the future. people want to work at the ftc. there's no doubt about it. if we say you have to sit with

somebody else like in a house or senate office, we'll make that work. >> our staff -- >> i'm sorry. what? >> our staff's sitting in like a big old pit. >> the bull pen. going back to the baseball analogy you started the hearing with. at this point there's a little uncertainty because a certain member who would like to -- a certain member who chairs another committee i believe is holding up some prospectuses. so we're hoping to get that through a committee on the house side soon. otherwise, we'll have to stay in our space and we'll have to pay a lot more for it and come back to you and -- >> all right. i will follow up on that. >> okay. ? and i appreciate that. but we need to start moving on this because it's ridiculous and i want to try to save money. joe. >> thank you. >> well, i think we've

established that miami is in pretty good shape for getting an office. and then -- >> if certain things happen -- another office would have to close. >> exactly. and then will he attend the ribbon cutting. that's a different issue all together, right? it is good. it is good. you know, we have made some comments here about duplicating services and so on. but i think what we need just to remember every so often as we talk about this new agency is it didn't happen in a vacuum. homeland security was not created in a vacuum. that whole conglomeration was created as a reaction to something. well, something went terribly wrong in this country in the financial markets and so on, which a lot of people agree something had to happen. and i'm not sure that everyone was willing to say the ftc, with your limited resources and so on, should handle all that was we tend wha

to forget. am i correct? >> that's right. >> the shortest answer you've given all day. i understand. let me ask you a question. i assume the ftc gets a large number of tips and complaints every day. are you able to follow up on all of them or just a fraction of them? and how do you choose which complaints to go after? >> that's a great question, and i know that you spent some time as chairman of the consumer protection agency in the new york state assembly. >> you remember that far back? >> we just read up on our appropriate or thes. we get something like, and my staff will correct me if i'm wrong, something like 2 million complaints a year. we put it in a database and it becomes a critically important way in which we determine which scams to go after. now, we also make this database -- we allow state attorneys general, because i think it's really critical that,

you know, all work together, to access that database and to give us data into it. and so we can all work together on fact youring out where -- which scams we should be trying to stop, you know, which ones will give the greatest benefit to the greatest number of people, and our complaint database is one way we do it. we also talk to consumer groups and honest businesses, because they don't want to be competed against. one of the interesting things is when we did our foreclosure or mortgage modification rule, we actually ended up having one of the trade associations for the companies that do this supporting our rule making in the end, because one is we listen to them, they had some suggestions, and two is they felt like they were at a competitive disadvantage. it's a hard thing to do. we try to do our best to really figure out where we can do the most good. and we work with our state agencies and other folks and with -- and with -- and with hud and with the department of

justice and treasury when we can. >> no comment. that sounds fine to me. that's even shorter than the answer. i must be doing a good job here. you mention a lot the working relationship with the state ags. do you ask them for information or do they always come to you with an issue that they want you to cover? >> it's a combination. sometimes on mergers and issues we generally take the lead. but on the antitrust investigations -- but sometimes they join us and occasionally they will do and maybe we should ask them to do more, some of the depositions we're doing in investigations and some of the document reviews. we have a lot of cross pollination with them. i did a youth privacy panel with eric schneiderman two weeks ago in new york and that was great because we hadn't met each other, although i worked with some of his predecessors. so tomorrow, the national association of attorneys general is in town, and i'm going over

to talk to them, and then they're coming back over to our agency and we're doing a workshop for them. so there's a lot of ways we cross pollinate, and we need to do more than that because obviously, you know, when we leverage our resources we all do bert for the consumers we try to represent. >> yeah. let me ask you a quick question on online shopping. the last couple years around the holidays, christmastime, we hear about how much more people are buying online. s so just by that percentage growth you would think there are more problems. is it more percentage growth, more buying, more problems, or does that medium lend itself more to schemes and bad information? >> you know, that's a great question. i don't know the answer to that. i do think when you don't have a person, there is a failure -- and there's no -- there's no one that you're necessarily speaking

with, it probably makes it easier in some ways to start a fishing site. and, you know, one of the issues where we have had -- we have been very bipartisan is the internet corporation for assigned names & numbers numbers. recently developed a plan to have all these new top-level domain names. we just thought it would be a hotbed for fraud, because you have all these new domain names. think about the ways you can misspell, like, marriott, right? now instead of 20 top-level domains -- and we're always chasing the bad guys. sometimes they're operating out of orange county, california, but they registered the name in berlin. we sent a 15-page letter from the commission urging them to go much slower to try to put in requirements where we know -- to know who's registering and to make sure the registration information is accurate. i would say i don't have an answer for you. it's a really good question. i will -- i'll follow up with

our staff and see if they have -- if they can try to quantify some of this. but i would say this. the internet gives all consumers great gifts in enormous ways. and online commerce is a terrific thing. but it also has led to a variety of fraud, and of course that's what we're supposed to be watching in our agency. >> it also has killed that great jack benny routine of shopping at christmas at the counter because there's no frank to exchange with. just gave away my age. >> i was just going to say, i thought you were younger than that. >> anyways, not that funny to buy online. you can't make it. all right. i have just one more question, madam chair, and it's a question that has to be asked, which is how would the ftc handle a 9.5% cut in 2013 if sequestration was to cur? >> well, and again -- this is

speaking for myself, i hope we don't see sequestration -- i'll gave short answer -- we would have to make a lot of tough choices and it would involve personnel and i.t. where we're desperately trying to catch up with the -- with the marketplace. and so it would be very, very difficult for us to do the things you want us to do. i think it would mean fewer cases and slower development of cases. again, having said that, you know, wherever we end up we'll do the best we can. wherever we end up with our appropriation. >> well, from my standpoint, we do away with cheap consents. that's the number-one thing. number two, i think we would probably hand off more to the cfpb, which, after all, is expected to handle these