Senate Banking Committee Holds Confirmation Hearing For CFPB Director, SEC Commissioner

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On March 12, the Senate Banking Committee held a confirmation hearing for Richard Cordray to serve as CFPB Director, and for Mary Jo White to serve as SEC Commissioner/Chairman. While majority and minority committee members commended Mr. Cordray for his leadership of the CFPB to date, the basic disagreement over the structure of the agency itself remains. Democrats maintain that Mr. Cordray deserves a confirmation vote, citing the facts that Congress already approved the structure of the CFPB, that it is the only financial regulator subject to a funding cap and whose rules are subject to a veto. Republicans argue that the CFPB lacks transparency and accountability, and that it should be changed to a commission structure and subject to congressional appropriations. In his testimony, Mr. Cordray stressed his efforts to be transparent and accountable, and Chairman Johnson (D-ND) entered into the record a letter from Rep. Stivers (R-OH) to the Committee calling on members to confirm Mr. Cordray as someone who could help bridge the gap on policy differences. Committee members also generally supported Ms. White. In her testimony, Ms. White addressed concerns from Senators on both sides about potential conflicts of interest given her recent work as a defense attorney, and stated her primary focus will be to finalize rules required by the Dodd-Frank Act and the JOBS Act. Additional priorities identified by committee members that Ms. White agreed should be agency priorities included finalizing rules for (i) credit rating agency conflicts of interest, (ii) money market funds, (iii) CEO pay versus median employee pay disclosures, (iv) high frequency trading, and (vi) crowd funding. Ms. White also pledged to vigorously enforce existing laws. The committee is scheduled to vote on both nominees on March 19, 2013.