Richard Cordray Nominated to Run CFPB

Richard Cordray

The President has nominated Richard Cordray, the former Ohio Attorney General, to run the Consumer Financial Protection Bureau. Elizabeth Warren had already brought Cordray in as director of enforcement for the agency.

Cordray had a short but impressive run as Ohio Attorney General, taking over for Marc Dann, who resigned after a sexual harassment scandal. Cordray was the very first Attorney General to sue a mortgage servicer over foreclosure fraud and robo-signing, in October 2010. I spoke with Cordray about that lawsuit against GMAC at that time. Unfortunately, he lost his re-election to former Sen. Mike DeWine in 2010, but Warren brought him into CFPB as head of enforcement.

“Richard Cordray has spent his career advocating for middle class families, from his tenure as Ohio’s Attorney General, to his most recent role as heading up the enforcement division at the (bureau) and looking out for ordinary people in our financial system,” Obama said.

Sen. Sherrod Brown, D-Ohio, called the selection of Cordray a “great move. There’s no question of Rich’s qualifications.”

He predicted the Senate will likely confirm Cordray for the post “unless they get to be hyper-partisan. My only fear is Republicans don’t think we should have consumer protection rules.”

I think Brown is being a little charitable. Republicans in fact don’t think we should have consumer protection rules. They have made themselves very clear on this point. I don’t think there’s a chance on earth that Cordray gets confirmed under a normal process. He could get a recess appointment, or the agency will get restructured somewhat in a deal to get him in as director. Otherwise, Republicans will obstruct. So if this was done to avoid a confirmation battle, forget it. The President will have to do what he would have had to do for Warren or anybody else if he wants a CFPB Director in the agency as it exists right now: recess appoint.

That said, this is a good choice. When the news broke earlier that someone from inside the agency would become the director, I was really hoping for Cordray over Raj Date.   [cont’d.] I think the pushback over Date from consumer advocates led to this choice. I know people will be upset over the Warren snub, but Cordray has integrity and experience and showed as Ohio Attorney General the desire to take a prosecutorial approach to dealing with banks ripping off his constituents. I think he will prove a strong regulator, provided that he actually find his way into that Director’s chair, which is in no way a done deal.

Warren expressed her support for Cordray in a statement. “Rich has always had my strong support because he is tough and he is smart-and that’s exactly the combination this new agency needs. He was one of the first senior leaders I recruited for the agency, and his work and commitment have made it clear that he will make a stellar director.”

Getting that endorsement obviously was crucial for the White House, and Warren was unlikely to give it to anyone she didn’t actually approve. So she probably has a lot to do with Cordray’s selection as well.

As for Warren herself, there’s been a lot of talk about the Massachusetts Senate seat and Warren challenging Scott Brown. I can confirm that the conversations with various elected officials did not end in May; her public schedule for June has just not been released yet. Bob Kuttner thinks that an announcement will be forthcoming within weeks. The Democratic field in that Massachusetts race is not particularly strong at the moment, and most of the politicians have hung back and refrained from endorsing. Warren would seem to have a lot of support if she were to jump in.

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