This week, President Joe Biden announced that Rohit Chopra is his choice to be the next director of the Consumer Financial Protection Bureau. Chopra, who was most recently a commissioner with the Federal Trade Commission, previously worked at the CFPB as an assistant director and its student loan ombudsman. How will the CFPB change under Chopra’s leadership, assuming he is confirmed by the Senate? AccountsRecovery.net reached out to a number of industry experts to share their reaction to Chopra’s nomination. Here is what they said.
Mike Frost, Malone Frost Martin
Unlike other federal regulatory agencies, the Consumer Financial Protection Bureau (CFPB) was not created with a traditional five-member commission, instead it is led by one-single Director. In the wake of the U.S. Supreme Court’s June 20, 2020 decision in Seila Law LLC v. Consumer Financial Protection Bureau, which held that the CFPB’s leadership structure violates the separation of power mandate by the U.S. Constitution, that one-single Director may be removed by the President, at will. Essentially, the traditional federal agency checks and balances are not present under the leadership construct of the CFPB and the revolving political door will now create an inherent shift in policy and direction at the CFPB with every change in administration.
President Joe Biden will nominate Rohit Chopra to be the next Director of the CFPB. It is no secret that Chopra is a strong consumer advocate that is aligned closely with Sen. Elizabeth Warren and that Chopra was originally selected to help set up the CFPB under the Obama administration, where he was employed as a CFPB assistant director and as student loan ombudsman in 2011, prior to his move to the Federal Trade Commission during the Trump administration.
The selection of Chopra indicates to me that the Biden administration plans to return the CFPB to the more aggressive posture that it possessed under the Obama administration. It is likely that entities under the purview of the CFPB will receive a heightened level of inquiry supervisory examinations and civil investigation demands through enforcement. Unfortunately, private and publicly traded business will see this extreme shifts in philosophy with every shift in administration until or unless there is a modification of the bureaus leadership structure.
Helen Mac Murray, Mac Murray & Shuster
Buckle up, financial services industry, with Rohit Chopra as the new driver of the CFPB, things are going to get rough. Gone are the days of $1 fines and in comes a former FTC commissioner who frequently complained that the FTC wasn’t hitting companies hard enough. Looking at Chopra’s many dissenting statements on FTC cases, you see a regulator looking to write more rules, charge companies with every different law violation that exists “across its mission” and awarding restitution to consumers and effected small businesses in every case. If that’s not scary enough, Chopra also wants to use the option to sue targets more aggressively. In my personal experiences, Commissioner Chopra begrudgingly agrees to hear a target’s perspective all while seemingly unwilling to independently interpret the facts of the case. He seems to ignore relevant individual circumstances and accepts staff recommendations on what appears to be blind faith.
Vaishali Rao, Hinshaw & Culbertson
I have known Rohit Chopra when I worked alongside the CFPB during my tenure at the Illinois Attorney General’s Office on student loan issues. I know Rohit to be a tough consumer advocate, but one that is accustomed to seeing the big picture. He is thoughtful, analytical, and trusts his team. I envision a Chopra CFPB to take a closer look at the intersection of innovation, technology and the delivery of financial services, regardless of industry sector. I don’t think he will be shy to enforce to the new debt collection regulations once effective. I believe Rohit will use data and market trends to dictate much of his priorities. However, early on, I predict he will focus on reversing Kraninger policies or guidance, such as restoring an office of fair lending. Enforcement actions are likely to increase under a Chopra CFPB.
Dara Tarkowski, Actuate Law
I think we can feel confident that CFPB enforcement activity will certainly be ratcheted up a few notches from the comparatively sleepy activity we observed during the Trump administration. No question that student loan debt – the sales and purchase process as well as servicing – will be a high priority item for Chopra. I would also expect a move toward more meaningful inter-agency cooperation between the CFPB, FTC and likely State AGS and state regulators as well.
Rachel Weintraub, Consumer Federation of America
Rohit Chopra is an incredibly strong pick to lead the CFPB. Commissioner Chopra has deep experience relevant to leading the CFPB effectively: leading student lending protection efforts at both the CFPB and at the Department of Education; and deep consumer protection and enforcement experience as a Federal Trade Commissioner. Commissioner Chopra has the experience, knowledge, and commitment to consumer protection to lead the CFPB and help it re-align its work with the mission of the agency which is to make the financial marketplace more fair for consumers.
