The Senate on Thursday approved Rohit Chopra to head the Consumer Financial Protection Bureau in a 50-to-48 party-line vote, overtaking objections from Republicans who said the bureau would use its far-reaching powers to pursue an anti-business agenda.
Mr. Chopra, 39, most recently served as a commissioner on the Federal Trade Commission and has often criticized this commission for seeing it unwilling to block violators. Facebook and Google were specific targets of his anger; He called for far greater financial penalties and stricter restrictions, referring to “the endless scandals involving big tech firms.”
As President Biden’s choice of director, Mr. Chopra will return to an agency he helped found. Congress established the Consumer Financial Protection Bureau ten years ago with a simple mission: to regulate financial companies and protect consumers. The brainchild of Senator Elizabeth Warren who listed this Twitter bio As one of her children alongside two human offspring, she set out to crack down on the kinds of abuse that led to the 2008 mortgage crisis and subsequent economic collapse. The Bureau quickly became one of Washington’s most feared and aggressive regulators.
“The CFPB is a young agency and you see it whipping up based on leadership,” said Ashley Taylor, Troutman Pepper’s expert partner in consumer finance regulation and enforcement. “The person at the top makes a huge difference.”
Mr. Chopra worked on the bureau’s development team and then became assistant director and served as the first student loan ombudsman until 2015. More than $1 trillion.
“He’s really part of the original Elizabeth Warren team that was there in the beginning and got the agency back on its feet and had a tremendous vision for what to do,” said Rachel Rodman, a former enforcement attorney at the firm and now a partner. The law firm Cadwalader is at Wickersham & Taft. “I see it as a return to that time and priorities after the Trump administration was disrupted,” he said.
Republicans have often demonized the consumer bureau for its ability to reshape industries by rewriting their rules and punishing those who push the boundaries. Senator Patrick J. Toomey from Pennsylvania, the top Republican on the Banking Committee, said he feared Mr. Chopra would return the office to “the lawless, overly large, highly politicized institution as it was during the Obama administration”.
To advance Mr. Chopra’s candidacy to the final vote, Vice President Kamala Harris broke the tie in a procedural vote. He also overcame stalemate to endorse Jennifer Abruzzo and Kiran Ahuja, general counsel to the National Labor Relations Board, in July. Became the Director of the Personnel Department In June.
Extended enforcement of fair lending laws is another area where observers await significant action. At his nomination hearing in March, Mr. Chopra said he was concerned about the risk of bias in matters relating to the privacy and security of data treasures collected by technology companies and financial service providers. algorithmic systems that increasingly drive credit decisions.
Mr. Chopra’s office is also likely to act as a leading watchdog over the burgeoning industry of non-bank fintech companies that issue mortgages, student loans and other loan products.
“Agencies want to be relevant, and with a director who is not afraid to expand the authority of the bureau, the CFPB can really shape this space,” said Ms Rodman.
The consumer bureau has swung like a pendulum between extremes in recent years. The agency is under the direction of its first director, Richard Cordray. overhauled mortgage loan rulesprosecuted hundreds of companies and withdrew nearly $12 billion in the form of canceled debts and consumer repayments from businesses. When Mr. Cordray left in the fall of 2017, President Donald J. Trump appointed Mick Mulvaney as acting director. blocked the executive branch of the bureau and severely restricted his work.
She was replaced by a less ardent leader, Kathleen Kraninger, who shared Mr. Mulvaney’s aversion to stricter financial regulation. criticized the bureau “pushing the envelope” and broke a planned rule this would have restricted payday loans.
But last year, a Supreme Court decision empowered the president. Fire the director of the Consumer Financial Protection Bureau Mr. Biden used that power to oust Ms. Kraninger in January. Since then, the bureau has been led by Dave Uejio, a deputy director who has worked there for nine years and most recently served as chief strategy officer.
Mr. Biden to replace Mr. Chopra on the Federal Trade Commission candidate Alvaro Bedoya, an online privacy expert.