President Fires Consumer Financial Watchdog Who Drew Ire of Banks
In a surprise move, the President announced that he will be firing the director of the Consumer Financial Protection Bureau (CFPB), Richard Cordray, and replacing him with a conservative economist who has long been critical of the agency.
Cordray, a Democrat, had been the head of the CFPB since 2012 and had drawn the ire of banks and other financial institutions with his aggressive efforts to regulate their practices. Under his leadership, the agency has cracked down on lenders for misleading borrowers and imposed stiff penalties for violators.
The President, a Republican, has long been critical of the CFPB and has sought to weaken its powers. The decision to fire Cordray is seen as a major victory for the financial industry and a setback for consumer advocates.
The new acting director of the CFPB is Mick Mulvaney, a conservative economist who served in the House of Representatives before joining the White House as the director of the Office of Management and Budget. Mulvaney has been a vocal critic of the CFPB and has long sought to gut its powers.
Consumer advocates are outraged by the decision and warn that it will lead to a decline in protections for consumers. They point out that Mulvaney has taken thousands of dollars in campaign contributions from payday lenders and has consistently voted against legislation that would help consumers.
The move is also seen as a major setback for the Obama-era financial regulatory regime, which sought to rein in the excesses of the financial industry and protect consumers. The CFPB was established in the aftermath of the financial crisis and has been a major force in holding financial institutions accountable.
The firing of Cordray is likely to spark a heated battle over the future of the CFPB. Consumer advocates will likely challenge Mulvaney’s appointment and seek to block any efforts to weaken the agency’s powers.
