If your credit union's alarm bells are not clanging and the sirens aren't wailing, then you must not be paying attention – your credit union is about to be robbed of the freedom to set its own direction. In recent days, President Barack Obama designated the liberal blogosphere-championed Harvard bankruptcy law professor Elizabeth Warren to launch the new Consumer Financial Protection Bureau. Rather than appoint controversial activist Warren as the statutorily-defined director of the bureau, the President side-stepped the U.S. Senate confirmation process by designating her as Assistant to the President and Special Advisor to the Secretary of the Treasury on the CFPB. Reportedly, in her new role Warren will recruit staff for the agency, set the policy mission, and serve as the public face for the CFPB.

U.S. Treasury Secretary Timothy Geithner, who under the Dodd-Frank regulatory reform law runs the powerful new agency until an official director is appointed and confirmed, has set July 21, 2011 as the day the CFPB takes over consumer compliance rulemaking and enforcement for credit unions, banks, and non-banks. However, the President has left no doubt that confrontational ideologue Warren is the one in charge.

Putting aside her unorthodox selection process, having Warren molding the powerful new agency that has the authority to prohibit financial product offerings and control prices confirms my worst big government nightmares. Like many other financial services industry executives who have been following the CFPB saga, I had hoped that the unwanted agency's leader would not be a partisan activist, but rather someone who would work effectively with all constituencies – including the industry and the other regulatory agencies. With her frequent accusations of financial services providers' "tricks and traps" and her punitive crusade against traditional banking "bullies," she is expected to act more like a rogue cop with a chip on her shoulder than as an even-handed and fair referee in a complicated marketplace.