This page was updated on March 14 to reflect the correct number of Republican Senators who pledged to block Cordray’s nomination unless the President agrees to eviscerate consumer protection powers of the agency.
March 12, 2013
Nomination Hearing on Richard Cordray and Mary Jo White Carries Major Ramifications for Consumers and Democracy
Nominees Faced With Decisions on Wall Street, Political Spending and the Future of Consumer Rights
Note: The Senate Committee on Banking, Housing and Urban Affairs will hold a hearing today, March 12, at 10:00 a.m. EST.
WASHINGTON, D.C. – Today, the Senate Committee on Banking, Housing and Urban Affairs considers the nominations of Richard Cordray to direct the Consumer Financial Protection Bureau (CFPB) and Mary Jo White to chair the Securities and Exchange Commission (SEC), with big consequences for consumers and for democracy.
If chosen to chair the SEC, White will be faced with implementing the stalled Dodd-Frank Wall Street Reform Act. White will need to navigate road hazards including threatened industry litigation, relentless Wall Street lobbying and SEC commissioners who share different views concerning reform, said Lisa Gilbert, director of Public Citizen’s Congress Watch.
“White’s record as a prosecutor of terrorists, Mafia dons and drug lords promises needed zeal for the SEC’s traditionally milquetoast enforcement division,” said Bartlett Naylor, financial policy advocate for Public Citizen’s Congress Watch. “But her current private sector employment defending Wall Street leaders raises serious concerns that her chief merit will be blunted by a period of recusals and personal affiliations. We hope to see her take a forceful role as head of the agency.”
Questions also remain as to where White will come down on the side of transparency and disclosure rules for corporate political contributions — a major issue in the wake of the U.S. Supreme Court’s Citizens United v. Federal Election Commission decision in 2010.
“In the Citizens United decision, Justice Kennedy wrote that shareholders know what’s spent by the companies they invest in and can make decisions based on that information,” added Gilbert. “Consideration of a disclosure rule is already on the SEC’s agenda. White should honor the 490,000 American citizens and investors who have petitioned the SEC asking that corporations disclose political spending by moving the rule forward.”
Whereas credentials figure in White’s nomination, few question the qualifications of Richard Cordray, who has received praise across the political spectrum. However, despite this praise, 43 Republican senators have pledged to block Cordray’s nomination unless the President agrees to eviscerate consumer protection powers of the agency.
“Taking a returning agency head nominee hostage to dilute consumer protection laws approved by the majority of Congress demonstrates the unfaltering loyalty of many in Congress to Big Banks, even when it comes at the expense of citizens,” said Gilbert.
Public Citizen expects that Sen. Elizabeth Warren (D-Mass.) will come out strong against those attempting to block Cordray’s nomination. Warren was one of the primary forces in creating the CFPB but was derailed in her bid to head the agency she conceived. She subsequently sought and won election to the Senate, and membership on the banking committee.
“Special drama awaits this important confirmation hearing,” predicted Naylor. “We expect the Massachusetts freshman to add her spirited voice to those defending the need for uncompromised consumer protection.”