Will CFPB Nominee Mirror Mulvaney?

Inside Subprime: Dec 3, 2018

By Lindsay Frankel 

As Kathy Kraninger advances towards a final Senate vote that would establish the nominee as head of the Consumer Financial Protection Bureau, Democrats are raising concerns that Kraninger will follow in the footsteps of acting director Mick Mulvaney. Critics cited her lack of experience as a predictor for her reliance on Mulvaney appointees, which would likely resume an anti-consumerism agenda.

“She has no experience in banking or finance or consumer protection,” said Sen. Sherrod Brown, ranking member of the Banking Committee, who recently released a report criticizing Mulvaney for eroding the agency’s mission. “She’s not on the side of millions of Americans, of people who work for a living.” Kraninger spent the majority of her career working for the Department of Homeland Security.

Democrats also question Kraninger’s involvement in certain Trump administration policies, including the separation of migrant children at the border and the response to 2017 hurricanes.

Sen. Elizabeth Warren, who originally established the CFPB, said that Kraninger’s nomination was based on her enthusiasm for Mulvaney’s policies rather than her qualifications. Kraninger said at her nomination hearing that she had yet to disagree with any of Mulvaney’s actions, in response to questions from Warren.

Still, Kraninger’s future at the Bureau remains unclear, since she did not directly answer questions about the controversial payday lending rule and other policies. As big decisions approach for the CFPB, industry groups and consumer advocates alike will be watching Kraninger’s decisions closely. These will include proposed changes to the payday lending rule and reviews of three other rules. The agency is also expected to propose rules for the debt collection market and attend to the Home Mortgage Disclosure Act in the Spring.

Richard Horn, former special adviser in the CFPB’s Office of Regulations, said Kraninger is expected to keep some consistency with Mulvaney’s agenda, but that doesn’t necessarily mean that reform is out of the question. He said, “…she is her own person, and once she gets in there she could have some different views and the agenda could change.”

Kraninger drew support from Republicans, who voted to limit debate on her nomination. Chairman Mike Crapo noted that she had gained “widespread support” from financial institutions, auto dealers, and realtors.

As early as this week, the full Senate will vote to confirm Kraninger, who currently works as a senior official at the Office of Management and Budget. Unlike Mulvaney, Kraninger will face opposition from the Democratic-controlled House come January. Rep. Maxine Waters, who will likely become the new chair of the House Financial Services Committee, has already indicated that her agenda will include aggressive oversight of regulators appointed by Trump.

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