Biden’s Choices for Financial Agencies Offer Insight into Regulatory Agenda
President BidenJoe Biden Biden Prepares to Face Putin Ukrainian President thanks G-7 countries for statement of support Biden aims to strengthen troubled relations with Turkey at first Erdoğan meeting MOREThe choices of, at the head of two leading financial regulators, shed light on their plans on Tuesday to extend consumer and investor guarantees while keeping financial firms to higher standards.
During their confirmation hearing, Biden’s nominees for the head of the Securities and Exchange Commission (SEC) and the Consumer Financial Protection Bureau (CFPB) pledged to be vigilant in a rapidly changing financial landscape – and in some case, perilous.
SEC Chairman Appointed Gary GenslerGary GenslerThe Hill’s Morning Report – Brought to you by Facebook – Democrats’ agenda in limbo as Senate returns SEC removes Republican watchdog after gradual lobbying effort Regulators should bring best of stock market regulation to crypto investing PLUS would head a commission that was quickly trapped in a high-profile debate last month over how close the stock government watchdog should handle an increase in investment activity driven by online trading platforms. online and the increasingly viral nature of the markets.
“Every day at work, I will be animated by working families and investor protection as the agency’s key mandate,” Gensler told members of the Senate Banking Committee on Tuesday.
“The technology provides better access, but it also raises interesting questions,” he continued. “We’re going to have to study and think about it and what it means for our market.”
The other candidate at Tuesday’s hearing – Director-designate of the CFPB Rohit ChopraRohit ChopraWarren urges Yellen to step up oversight of BlackRock FTC considers new approach to pharmaceutical mergers Senate panel pushes Biden’s choices to lead SEC, office of consumer affairs MORE – would be in charge of a powerful consumer watchdog agency tasked with ensuring that tens of millions of Americans who relied on housing protection and debt relief during the pandemic can leave these programs without ill-treatment or deception.
“Although Congress has paused on many issues in the mortgage market, we are not out of them,” Chopra told Senators.
“A lot of families will struggle. They lost income, they may not be able to take back [payments] and we need to make sure they can stay home when they have the chance. “
Gensler and Chopra both appear on the 50-50 Senate confirmation lane, where Vice President Harris can vote to break the tie. A simple majority is needed for either to take the oath, and Gensler and Chopra have already been approved for Senate confirmed positions.
While confirmation is likely, that doesn’t mean the candidates haven’t faced harsh warnings, from both Republicans and Democrats.
“The SEC has been sleeping on the job for quite a long time. It is time for the committee to stand up and protect investors and consumers, and I expect to see progress in all of these areas under your leadership, ”the senator said. Elizabeth warrenElizabeth WarrenMcConnell Seeks to Divide and Conquer Democrats Mark Cuban: ProPublica “Not Honest” About Taxes on Rich On The Money: Biparty Senate Group Excludes Infrastructure Tax Hikes | New report rekindles pressure for wealth tax (D-Mass.) Told Gensler on Tuesday.
On the other end of the political spectrum, several Republican senators have complained about Gensler and Chopra’s broad visions for the agencies they are appointed to head, raising doubts about the extent of bipartisan support they will receive for the both at the committee level and over the floor voices.
Chopra, federal trade commissioner since 2018 and former CFPB student loan watchdog, drew the most Republican backlash.
Throughout his career, Chopra has lambasted federal regulators for refusing to penalize powerful companies for misconduct to the extent that he believes they deserve it. His sweeping condemnation of the FTC’s Facebook settlement has garnered bipartisan praise from big tech critics and enthusiastic liberals who support tougher sanctions on big business.
Chopra said on Tuesday he plans to continue this approach at CFPB, arguing that meager penalties and low-key regulations hurt companies that play by the rules and leave consumers vulnerable to abuse.
“It’s something that just doesn’t make economic sense,” Chopra said. “When you rip someone off and you don’t have to pay them back, how is that really a penalty? “
Progressives can’t wait for Chopra to bring that mentality to the CFPB after four years of looser oversight, quiet enforcement, and regulatory rollbacks imposed by officials appointed by Trump.
Chopra set to follow precedent set by former CFPB director Richard CordrayRichard Adams CordrayBiden administration reverses Trump-era policies that hampered investigations into student loan companies. A quarter of Americans suffered financial blows in 2020: Supporters of Fed student debt cancellation encouraged by Biden, others remain skeptical MORE and Warren, the agency’s architect, with a focus on tough penalties, shaming the public and unequivocal warnings to the rest of the industry.
For Republicans, this is precisely why Chopra’s appointment is problematic.
GOP lawmakers and financial industry advocates have raged for years against the CFPB’s aggressive regulatory and enforcement agenda under Obama-appointed officials and have warned Chopra against using such tactics.
“We know that Commissioner Chopra favors irresponsible regulators with broad powers,” said the senator. Pat ToomeyPatrick (Pat) Joseph Toomey Black Women Seek To Build On Gains In Upcoming Election Watch Live: GOP Senators Introduce New Infrastructure Proposal Sasse Rebuilt By Nebraska Republican Party For Impeachment Vote MORE (Pa.), The ranking of the Republican Banking Committee.
“I wonder whether or not he made the CFPB at the anti-business agency hyperactive and often in violation of the law that it was under the Obama administration.”
While the reviews Gensler received were lukewarm in comparison, he also made commitments that angered Republicans.
Gensler, who served as Chairman of the Commodity Futures Trading Commission during the Obama administration, has expressed support for requiring publicly traded companies to disclose more information about the climate risks they face. face and the money they donate to political causes – two key Liberal priorities.
Republicans have argued that such requirements provide little important information to investors, are not worth the time and effort required to comply, and could keep companies away from legal but politically unfavorable activities.
Senator Cynthia lummisCynthia Marie LummisRule Allowing Predatory Lending From Fake Lenders Must End Now Rick Scott Introduces Bill Banning ‘Vaccine Passports’ for Hillicon Valley Domestic Flights: Amazon Faces Racial and Gender Bias Lawsuits | Senate trade panel pushes Biden’s top science candidate forward | Colonial Pipeline CEO to testify on Capitol Hill in June MORE (R-Wyo.) Told Gensler that his state’s revenues – which are heavily dependent on fossil fuel exports – were “drastically declining” amid the shift to renewable energy sources and worried that climate disclosures do “make it harder for energy companies to raise capital.” “
Gensler countered that energy companies could benefit from a clear set of standards to level the playing field, as a growing number of investors prioritize climate change in their portfolios.