Saying that we “shouldn't be weakening oversight and accountability. We should be strengthening it – especially when it comes to looking out for families,'' President Obama on Wednesday circumvented Senate Republicans and made a recess appointment of Richard Cordray to run the Consumer Financial Protection Bureau.
Obama, who made the announcement during a speech on the economy and job creation in the Cleveland suburb of Shaker Heights, Ohio, said Cordray will “be in charge of one thing: looking out for the best interests of American consumers. His job will be to protect families like yours from the abuses of the financial industry. His job will be to make sure you've got all the information you need to make important financial decisions.''
The appointment, which runs until the end of the year, ended a fight that Obama had with Senate Republicans who had used the chamber's rules to block Cordray's confirmation even though a majority of senators supported it.
Cordray was nominated to run the CFPB last July and his nomination was approved along party lines by the Senate Banking Committee.
The CFPB is an independent agency housed inside the Federal Reserve and created following the Dodd-Frank Act. It has direct supervisory authority over financial institutions with assets of more than $10 billion though all financial institutions must comply with its regulations.
Cordray, a former Ohio attorney general, has headed the CFPB's enforcement efforts since last January. CUNA President/CEO Bill Cheney issued a statement saying that his group has “has met with Mr. Cordray at the Consumer Financial Protection Bureau and the Ohio League has developed a strong, professional relationship with him. The fact that the agency now has a director holds ramifications for credit unions, other financial institutions and financial service providers that have been unregulated at the federal level before now.''
NAFCU President/CEO Fred Becker told Credit Union Times that his group “looks forward to working with Mr. Cordray. Those credit unions that have worked with him have found him reasonable and someone who understands the credit union industry.''
By having a permanent director in place, the CFPB will be able to regulate mortgage companies, payday lenders, debt collectors and other financial companies.
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