Committee clears CFPB hopeful Cordray for wider Senate vote
The Senate Banking Committee voted to accept the nomination of Richard Cordray for the position of director of the Consumer Financial Protection Bureau Thursday. But securing Senate-wide approval seems unlikely any time soon. President Obama nominated Cordray in July to lead the bureau formed under the Dodd-Frank Act to oversee consumer lending in the U.S. and become the de facto regulator of the mortgage industry – from origination through servicing. But without a director, the bureau cannot finalize new rules or supervise nonbank financial institutions such as payday lenders and title-loan services. Cordray needs 12 of the 22 committee members to approve him in order to move on to the Senate. Given a vote along party lines, the 12 Democrats should clear Cordray Thursday. But 60 senators would need to approve Cordray before he can take control of the CFPB. The 52 Democrats would not be enough to override a promised Republican filibuster. In July, the Republicans in the House of Representatives passed a bill that would set up a five-member bi-partisan commission to run the bureau and provide regulators on the Financial Stability Oversight Council stronger powers to veto any CFPB rule. A group of 44 Senate Republicans sent a letter to Obama promising to filibuster any nomination until the commission was put in place and the powers were given to the FSOC. "I am sorry that you are caught up in all of this," Sen. Bob Corker (R-Tenn.) told Cordray during a previous hearing. "All of this would go away if the administration would just sit down and put appropriate checks and balances in place." Advocates for the bureau say a director is needed to restore confidence in a still shaky housing market. Obama said during a speech when he nominated Cordray that Republican plans to install what they call proper oversight of the agency are merely efforts to defang it. "I remain hopeful that those who want to cripple this consumer bureau will think again and remember that the financial crisis — and the recession and job losses that it sparked — began one lousy mortgage at a time," Obama said. Write to Jon Prior. Follow him on Twitter @JonAPrior.