Today's Trends in Credit Regulation

Consumer Financial Protection Bureau: CFPB Watch
By Thomas B. Hudson

Focus on Elizabeth Warren (continued from last month)

Gossip in D.C. has Elizabeth Warren still in the running to head up the new Bureau. Supposedly others whose names have been floated are deferring to her as long as there’s any chance at all that she would be appointed and confirmed.

We picked up a genuinely strange rumor two weeks ago. The Republicans are trying hard to impose some restrictions on the Bureau’s independence and funding by making it a “commission” with five commissioners (like the Federal Trade Commission) and requiring congressional approval of its funding levels. President Obama wants Elizabeth Warren to run the show. The strange rumor has the Republicans agreeing to confirm Warren in exchange for the Democrats agreeing to the reforms on independence and funding. This seems unlikely, and we wouldn’t report it, except for the fact that the source – a highly-placed FTC official – is so reliable.

Time’s running short for President Obama, if his objective is to name Warren as our top credit cop. If he were to nominate a director of the CFPB now, it would leave only a few short legislative weeks for a Senate confirmation of the selection before the Bureau officially assumes its authorities. It’s still possible that Obama may nominate someone less controversial. Several names have been floated, including Federal Reserve Governor Sarah Bloom Raskin.

President Obama still could make a recess appointment of Elizabeth Warren, who has been serving as the de facto head of the Bureau. Most Washington observers believe that such an appointment would meet a great deal of Republican resistance.

If you haven’t visited the CFPB’s website recently (, you ought to take a look. Although it has gotten a bit “cob-webby,” with a lot of material that has been displayed for awhile, a couple of things caught my eye on a recent visit. One item discussed the Bureau’s budget and the amounts that have been advanced by the Federal Reserve Board so far. Another item was an updated organization chart bearing a date of April 25 (see the chart below). Elizabeth Warren shows up in lots of places on the site – it’s hard to shake the impression that she’s the boss, and the face, of the Bureau.

In the role as the Bureau’s “face,” Warren showed up on The Daily Show with Jon Stewart to lash out at what she perceives as the Bureau’s enemies. According to her, the fight about the Consumer Financial Protection Bureau has moved “from Main Street to the dark alleys.” There are bills pending in Congress to “delay the agency, to de-fund the agency, to de-fang the agency,” she said. Evidently, the halls of Congress, where those bills have been introduced, weren’t “dark alleys” when the bills being introduced were the ones creating her Bureau.

Thomas B. Hudson is a partner in the Maryland office of Hudson Cook, LLP. Tom can be reached at 410-865-5411 or by email at

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