Trump Nominates CFPB Critic Brian Johnson to Lead Agency

President Trump has nominated Brian Johnson to be director of the Consumer Financial Protection Bureau, pending Senate confirmation.

Johnson is a former financial regulator and a senior executive at Capital One. He served in the number two position at the CFPB during President Trump’s first term, Reuters reports.

Johnson has been a critic of the CFPB and has testified before Congress in efforts to reduce its funding. He also was critical of CFPB’s enforcement actions and regulations. 

Johnson’s confirmation could signal a narrower CFPB agenda, according to critics of the nomination. Under Acting Director Russell Vought, massive staffing cuts have already reduced the size of the consumer protection agency.

Mark Paoletta, chief legal officer at the CFPB, will take over as acting director until Johnson completes the Senate confirmation process.

Nomination Applauded by Bankers

The Consumer Bankers Association welcomed Johnson’s nomination.

“We congratulate Brian Johnson on his nomination to lead the CFPB and welcome the opportunity to work with him as the Bureau enters its next chapter,” said Lindsey Johnson, President and Chief Executive Officer of the Consumer Bankers Association.

“America’s leading Main Street banks look forward to engaging with Director-designate Johnson on policies that provide certainty and create a more durable, stable CFPB where the Bureau meets its mission of consumer protection in a manner consistent with its congressional mandate.”

Warren Opposes Nomination

U.S. Senator Elizabeth Warren, (D-MA) spoke out against Johnson’s nomination.

“Starting in August, Russ Vought can no longer legally serve as Donald Trump’s hatchet man at the CFPB. So here comes the next hatchet man to try to finish the job and gut an agency that has returned more than $21 billion to cheated consumers,” Warren said. 

“Trump promised to lower costs on ‘day one.’ Instead he is doing everything in his power to reward the big banks and giant corporations that scam Americans out of their hard-earned money.”

“Here comes the next hatchet man to try to finish the job and gut an agency that has returned more than $21 billion to cheated consumers.” — Senator Elizabeth Warren 

Warren is credited with coming up with the idea for the CFPB when she was a professor at Harvard Law. She also helped to build the agency as a special advisor to the Treasury Secretary under President Obama, American Banker reports.

Attempts to Shut Down the CFPB

Vought as acting director tried to shut down the CFPB. His strategy was to eliminate the funding for the agency by refusing to accept money from the Federal Reserve for the CFPB. But judges prevented his efforts. 

In March, U.S. District Judge Edward J. Davila, of the U.S. District Court for the Northern District of California called his tactic a “transparent display of partisanship.” 

In December, a federal district judge also ruled that the CFPB must continue to request funding from the Federal Reserve.