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    Cordray Confirmed as the First CFPB Director

    Aug 13, 2013
    In late July, the Senate confirmed Richard Cordray as the first director of the Consumer Financial Protection Bureau, or CFPB. The vote was a victory for the Obama administration, which has been struggling to get its nominees through the confirmation process. It was also a victory for the Senate, which struck a last minute deal to avoid changing the Senate rules on filibustering confirmations.

    In late July, the Senate confirmed Richard Cordray as the first director of the Consumer Financial Protection Bureau, or CFPB. The vote was a victory for the Obama administration, which has been struggling to get its nominees through the confirmation process. It was also a victory for the Senate, which struck a last minute deal to avoid changing the Senate rules on filibustering confirmations.

    Cordray’s agency, the CFPB, was created in July 2010 as a result of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The law was the most sweeping banking reform bill since the post-Great Depression era. The CFPB consolidates most federal consumer financial protection authority in one agency that is further organized into six divisions. According to the CFPB website, the bureau is focused on “watching out for American consumers in the market for consumer financial products and services.”

    In the Senate, Cordray’s confirmation was the first test vote after senators met to discuss a plan to avoid implementing the “nuclear option” for presidential nomination filibusters that majority leader Harry Reid (D-NV) had been threatening. Due to the number of presidential nominations that have not come to a vote on the Senate floor, Reid said he would request a change in Senate floor rules to allow the nominations to be confirmed with a 51-vote majority as opposed to the 60-vote majority currently needed. A deal was averted with the agreement that Republicans would approve all the nominations except two, which would be withdrawn. Cordray’s nomination was the first to be voted on after this deal was struck, and the confirmation resolution passed 66-34.

    So far the CFPB has implemented seven programs to carry out its mission as detailed by the rules in Dodd-Frank. The agency’s core functions are to write rules; supervise companies; enforce federal consumer financial protection laws; restrict unfair, deceptive, or abusive acts or practices; take consumer complaints; promote financial education; research consumer behavior; monitor financial markets for new risks to consumers; and enforce laws that outlaw discrimination and other unfair treatment in consumer finance.

    The CFPB will be an important agency to watch. All of the functions stated above, as well as most of the rules that the agency will propose and oversee in coming months and years, will or do contain recordkeeping components. With its focus on consumer protection, recordkeeping requirements and privacy protections can be expected to be more carefully considered and guarded. 

    The Washington Policy Brief is an online advisory that contains brief summaries of recent legislative and regulatory issues that may affect the records and information management profession. Further information about the issue is accessed by clicking on the link provided at the end of each summary.

     

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