WASHINGTON (Legal Newsline) - A hearing to discuss the nomination of former Ohio Attorney General Richard Cordray to a key consumer protection post has been postponed.
The Senate Banking Committee had a hearing scheduled this week but have delayed it until September, after senators take an August recess. President Barack Obama nominated Cordray as the head of the Consumer Financial Protection Bureau in July.
"The fact is the financial crisis and the recession were not the result of normal economic cycles or just a run of bad luck," Obama said while nominating Cordray. "They were abuses and there was a lack of smart regulations."
The bureau was created by the Dodd-Frank regulatory overhaul and is tasked with regulating consumer financial products.
In November, Cordray lost to former Lt. Gov. and U.S. Sen. Mike DeWine, a Republican, in the state attorney general race. He had been elected to the post in November 2008 to serve the remainder of the term held by the previous attorney general, Marc Dann. Dann had resigned in May 2008 amid a sex scandal.
Prior to being attorney general, Cordray served as the Ohio State Treasurer and as treasurer of Franklin County, Ohio. He also served as a member of the Ohio House of Representatives and as the state's first solicitor.
Senate Republicans are expected to oppose Cordray's nomination. The American Tort Reform Association is also skeptical, questioning his relationships with private attorneys he hired to pursue state lawsuits while the attorney general.
"Mr. Cordray appears to share CFPB architect Elizabeth Warren's often voiced belief that litigation is a perfectly legitimate means by which to craft public policy, even though it sidesteps duly elected lawmakers and executives, and even though it lacks proper transparency," ATRA president Tiger Joyce said.
Joyce also says he hopes senators question the power given to state attorneys general by the CFPB.
"Ongoing settlement negotiations between Mr. Cordray, other CFPB enforcement staff and state attorneys general with major mortgage banks is a case in point," Joyce continued.
"Though President Obama's signature was recently rendered by auto-pen to enact reauthorization of the anti-terrorism Patriot Act and, to date, no infamously robo-signed foreclosure documents have been shown to be substantively in error, the public has been kept in the dark and will apparently have no input on a settlement that, at a minimum, will hugely affect mortgage lending."
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