The Wall Street Journal is reporting that Sen. Christopher Dodd and Rep. Barney Frank are at odds over who should lead the Consumer Financial Protection Bureau.
Frank, the House Financial Services Committee chairman, has joined his party’s liberal base in pushing for Harvard Law Prof. Elizabeth Warren to head the bureau, and wants her named without delay. Dodd, the Senate banking chairman, questions whether Ms. Warren could get the 60 votes needed for confirmation. He appears to be waging a one-man campaign to persuade the White House to nominate anybody else.
Even if Warren could be confirmed, a heated battle over her in the Senate would likely delay the new agency’s writing of new financial rules, something Dodd wants to avoid. Dodd went so far as to ask a Republican, Federal Deposit Insurance Corp. Chairman Sheila Bair, to consider the post. She declined.
Dodd also opposes the White House using a recess appointment to install Ms. Warren, bypassing a Senate vote. That same idea is being urged by some of Ms. Warren’s backers, including Frank. “It’s a great idea,” he said in an interview.
According to Reuters, Warren paid a visit to the White House last week on Thursday. “Elizabeth Warren was at the White House to meet with staff, as she has multiple times throughout the financial reform process,” an administration official said.
White House spokeswoman Amy Brundage told Reuters, “the president believes that Elizabeth Warren is a champion for middle class families and consumers and she, among others, is a strong contender for this position.” Adding, “the President has not yet made a decision and no announcement is imminent.”
Other names floated by the Obama Administration include Assistant Treasury Secretary Michael S. Barr and Eugene Kimmelman, a deputy assistant attorney general in the Justice Department’s Antitrust Division. However, several reports put Warren as the front runner.
The act gives Obama the authority to appoint an independent director of the new consumer bureau to a five-year term, subject to Senate confirmation. Whoever Obama chooses to lead the new consumer protection agency, they will have broad authority to shape the bureau and remarkable autonomy after it is up and running to write and enforce rules governing credit cards, loans, as well as reverse mortgage products.
The bill requires that the bureau conduct a reverse mortgage study to determine any deceptive practices and figure out whether suitability standards are necessary. It will also determine whether additional safeguards are needed to protect consumers from being sold reverse mortgages to fund inappropriate annuities, investments, and other financial products.