President Obama announced the nomination of former Ohio State Attorney General Richard Cordray to be the first director of the Consumer Financial Protection Bureau (CFPB).
In two years as Ohio attorney general, Cordray was a leading of proponent of challenging banks over their mortgage foreclosure practices. He has served as Director of Enforcement for the CFPB since November when Warren called him following losing his Attorney General reelection bid.
In nominating Cordray, the President passes over Elizabeth Warren who is credited with envisioning the concept of the CFPB and has overseen its formation and preparation for official launch on July 21. Warren faced staunch opposition from Republicans, who hold sufficient votes to filibuster a nomination, suggesting she is too contentious with the banking industry.
In his announcement, President Obama said, "American families and consumers bore the brunt of the financial crisis and are still struggling in its aftermath to find jobs, stay in their homes, and make ends meet. That is why I fought so hard to pass reforms to fix the financial system and put in place the strongest consumer protections in our nation's history. 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 CFPB and looking out for ordinary people in our financial system."
The President also thanked Warren for her work in developing the concept of the CFPB and her efforts in setting up the new agency. Reports suggest that after leaving the CFPB, she will return to Harvard University in the fall to resume her post as Leo Gottlieb Professor of Law. It has also been suggested that she may consider a run for the Massachusetts Senatorial seat currently held by Scott Brown.
Cordray will face his own challenges in the nomination process, not only because of his history of an adversarial relationship with the banking industry, but also due to changes Republicans seek in the agency's structure.
The Republicans have called for three changes to the bureau before allowing any confirmation process to conclude. First is to replace the single director position with a five person commission. Second is to subject the bureau to the Congressional appropriations process which would provide Congress oversight over the CFPB's budget. Lastly, establish a safety and soundness check for the prudential regulators tasked with oversight of financial institutions.