Today, President Obama will nominate former Ohio Attorney General Richard Cordray to be the first director of the Consumer Financial Protection Bureau that was established by the Dodd-Frank financial reform law. Cordray is currently the bureau’s director of enforcement. “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,” Obama said in a statement.
The clear first choice to head the Bureau was Professor Elizabeth Warren. The very idea of a consumer protection agency was hers, and she has been setting the Bureau up as a special adviser to the President. That said, Cordray has a clear pro-consumer record, and has not been afraid to challenge the banks, making him an ideal candidate to lead the bureau when it officially stands on its own this week.
He was at the forefront during the foreclosure fraud scandal, and was “the first to sue a mortgage lender over incidents of foreclosure fraud,” launching a suit against GMAC Financial. “What we’re talking about here is not just sloppy paperwork,” Cordray said at the time. “We’re talking about fraud in a court of law. The [foreclosure document signers] were lying under oath, to a judge.” He’s called the foreclosure practices of the nation’s biggest banks “a business model built on fraud.”
As attorney general, he supported efforts to rein in payday loans, one of the most pernicious financial products. Cordray backed legislation to cap the interest rate that payday lenders could charge and sought the ability for his office to prosecute unlicensed lenders.
The financial industry is already up in arms about his nomination, with one attorney who represents the industry saying that of all the bureau’s officials, Cordray “frightens me the most.” Another derided him as having “all the hard edge and ambition of Warren without the charm.” Warren herself supports the choice of Cordray, writing in an op-ed today that “he will make a stellar director.”
Already, Senate Republicans have said they won’t confirm Cordray (or any nominee to the lead the bureau), begging the question of why the administration passed over Warren, since its argument is that she is unconfirmable. “Until President Obama addresses our concerns by supporting a few reasonable structural changes, we will not confirm anyone to lead it,” said Sen. Richard Shelby (R-AL). But the politics of the situation don’t take away from the fact that Cordray has an excellent record and is absolutely qualified to head the bureau.