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President Barack Obama has nominated the first director of the new Consumer Financial Protection Bureau, or CFPB, created by the Dodd-Frank Wall Street Reform and Consumer Protection Act he signed into law last year.
The nomination is important for banking customers, banks and nonbank financial institutions that soon will be subject to the bureau's regulatory oversight with respect to federal consumer financial protection laws.
The nominee is Richard Cordray, currently chief of enforcement at the CFPB. Cordray previously served as the attorney general in the state of Ohio, recovering more than $2 billion for the state's retirees, investors and business owners and taking steps to help protect consumers from fraudulent foreclosures and financial predators, according to his official biography. Before that, he was state treasurer in Ohio and treasurer of Franklin County, also in Ohio.
Prior to those positions, Cordray was an adjunct professor at The Ohio State University's Moritz College of Law, state representative for the 33rd Ohio House district, solicitor general in Ohio and a sole practitioner and of counsel to Kirkland & Ellis, a law firm. A graduate of Michigan State University, Oxford University and the University of Chicago Law School, he was also a law clerk for U.S. Supreme Court Justices Byron White and Anthony Kennedy and has argued seven cases before the U.S. Supreme Court.
So far, the CFPB has been pushing credit card issuers to simplify their disclosures of fees and costs, re-redesigning a form lenders use to disclose mortgage terms and taking initial steps to monitor payday lenders, debt collection agencies and other nonbanks to ensure compliance with consumer financial protection laws, according to a White House press statement.
Forty-four U.S. Senators have already vowed not to confirm any nominee to the post, according to a statement released May 5 by Sen. Richard Shelby (R-Ala.). Instead, these lawmakers want Congress to replace the CFPB director with a board, subject the CFPB to the Congressional appropriations process and establish a "safe-and-sound" check by other bank regulators to ensure CFPB regulations don't contribute to bank failures.
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