Senate Panel Gives Thumbs-Up To Confirming CFPB Director Cordray

CFPB Director Richard Cordray

CFPB Director Richard Cordray

Consumer Financial Protection Bureau director Richard Cordray moved one step closer to sticking around as the young agency’s head this morning, with the Senate Banking Committee narrowly giving its approval to his confirmation.

The committee vote was along party lines, resulting in a 12-10 vote in favor of confirming Cordray.

In a statement, the committee’s chairman, Senator Tim Johnson of South Dakota, had a number of positive things to say about the CFPB director.

“Since his first confirmation hearing in September 2011, Director Cordray has appeared before this Committee more than any other financial regulator,” said Johnson. “During that time, he has proved to be a strong leader of the CFPB. He has completed many of the rules required by Wall Street Reform, including a well-received final [Qualified Mortgage] rule. He listens, and has crafted strong rules that take into account all sides of an issue. He has laid the groundwork for nonbank regulation. He has brought to light the financial challenges faced by students, elderly Americans, servicemembers and their families. He has taken important enforcement actions against banks that took advantage of customers. So I ask my colleagues, what more can Richard Cordray do to deserve an up-or-down vote? I hope we can finally put aside politics and move forward with Richard Cordray’s confirmation.”

Senator Mike Crapo of Idaho, the committee’s Ranking Member, voted against the confirmation, but reiterated the general view among Republicans that their concern isn’t with Cordray, but with the structure of the CFPB itself.

“The issue with his nomination is the broader debate over the structural creation of a new federal department,” Crapo said. “The CFPB structure needs to be revised to fit the model of traditional departments and agencies.”

Some Senate Republicans have vowed to block the confirmation unless there are significant changes made to the Bureau’s structure. They want to see a single directorship replaced by the more standard bipartisan commission structure seen in other agencies. Republicans also believe Congress should have authority over the CFPB budget, rather than the Federal Reserve.

Democrats and consumer advocates have maintained that these changes would only serve to weaken the agency in a time when strong, authoritative oversight of this nation’s financial institutions.

“Richard Cordray has made sure that the CFPB does exactly what it was created to do — stand on the side of consumers and ensure that they are protected from the deceptive banking practices and predatory deals that took advantage of too many Americans,” says Pamela Banks, senior policy counsel for Consumers Union. “Under his leadership, the CFPB has been both effective and transparent in their work on a variety of financial issues including credit cards, mortgages, student loans, and bank account services. It is imperative that CFPB continue at full speed in their work protecting consumers and Richard Cordray is the right person to have at the helm. We urge the Senate to abandon efforts to weaken the CFPB and confirm Richard Cordray as Director.”