Today, the Senate voted on and confirmed Kathy Kraninger as the next Director of the Bureau of Consumer Financial Protection (BCFP or Bureau). The vote was split 50-49.
President Donald Trump’s nomination of Kraninger for the top role at the Bureau was first announced back in June of this year. In July, Kraninger underwent a Senate confirmation hearing where she didn’t reveal much. Kraninger’s nomination was approved by the Senate Banking, Housing, and Urban Affairs Committee in August, sending the nomination to the full Senate for a vote. Earlier this month, Senate Majority Leader Mitch McConnell (R-KY) filed cloture for the vote on Kraninger to occur after Thanksgiving break and yesterday we found out that the vote would occur today.
Kraninger’s nomination faced criticism, particularly from Sen. Elizabeth Warren (D-MA) since it was first announced. Back in July, Sen. Warren released a reported entitled Record of Failure; Kathy Kraninger’s Disastrous Tenure at the Office of Management and Budget. Following Kraninger’s confirmation hearing, Sen. Warren submitted ten pages worth of questions for the record to Kraninger. On November 27, 2018, Sen. Warren submitted a letter to her fellow senators strongly urging them to vote against Kraninger’s nomination, in essence stating that Kraninger would continue the work of Acting Director Mick Mulvaney, which Sen. Warren strongly opposes.
During today's Senate floor proceeding, Sen. Warren reiterated her concerns from the November 27 letter stating that "American families deserve a fighter" at the head of the Bureau, and that Kraninger "is not that person."
Despite the pushback, the Senate confirmed Kraninger.
Lisa Donner of the Americans for Financial Reform stated,
"The Senate majority has endorsed a CFPB nominee indistinguishable from Mick Mulvaney, who has done his level best to dismantle from within an agency that once won real results for American families hurt by Wall Street and predatory lenders. Kraninger has no track record at all of consumer protection, or of standing up for vulnerable people. To the contrary, at OMB she has played a hidden role in the appalling and immoral family separation policy. Senators who voted for Kraninger have voted to expose American families to greater financial insecurity and abuse at the hands of Wall Street."
Competitive Enterprise Institute Senior Fellow John Berlau provided this statement,
"The Competitive Enterprise Institute congratulates Kathleen Kraninger on her confirmation as new director of the Bureau of Consumer Financial Protection and commends Mick Mulvaney’s service as Acting Director of the BCFP, formerly known as the CFPB.
In the year that Mulvaney headed the BCFP, he made it responsive to consumers rather than to the bureaucrats and busybodies who thought they knew best and wanted to dictate consumers’ financial choices. Under his tenure, the BCFP both punished wrongdoers and ensured there was due process for regulated companies. This was in sharp contrast to Mulvaney’s predecessor, Richard Cordray, under whose tenure the bureau arbitrarily and retroactively applied regulatory punishments against certain financial firms without due process.
We believe Kraninger will continue the Bureau’s new direction of being tough but fair and promoting consumer choice. Her statements during the confirmation hearing indicated she values a thorough and fact-driven rulemaking process and wants to help bring down the cost of consumer credit by expanding choice and competition.
We also hope Congress will take Kraninger up on her offer to make the BCFP more accountable by making its budget subject to congressional appropriations and its director subject to presidential removal. Government entities must be answerable to the American people, no matter what political party controls the executive and legislative branches of government."
During the vote, Acting Director Mick Mulvaney stated during a Consumer Advisory Board conference call, "This may be the last thing I do [as Acting Director], as the Senate is voting on Kathy Kraninger literally as we are on this call... I was not involved in the decision to pick her for the role, though many think I was. However they could not have picked a better person. [I would expect] the transition to be as seamless as a transition can be."
More than a year after former Director Richard Cordray stepped down, we have a new Bureau Director. We now wait to see what Director Kraninger will do. Most notably for the ARM industry, all eyes are on whether or not the third party debt collection rules, first announced back in 2013 and most recently set to be released in March 2019 after many delays, will continue on track, be delayed, or be scrapped altogether. Stay tuned, folks.