For those who think the Consumer Financial Protection Bureau’s pendulum has swung too far in one direction, the song being sung by Jonathan McKernan during his prepared remarks before the Senate Banking Committee today at his nomination hearing to be the Bureau’s next director will feel like listening to a greatest hits anthology. McKernan will say that the Bureau has “pushed beyond the limits of its statutory authority,” “seized opportunities to expand its jurisdiction and power,” “offended our basis notions of fairness,” and that it “suffers from a crisis of legitimacy.”
McKernan even goes as far as to say that the CFPB has “harmed” consumers because its actions have lead to higher prices and reduced choice by failing “to strike an appropriate balance between costs and benefits in prescribing new regulations.” For anyone who has criticized the actions of the Bureau for the past four years, this must be music to their ears.
McKernan’s prepared remarks are on the brief side, and what matters more is how he will answer questions from the members of the committee today in what is likely a rubber stamp formality to him being approved by the committee and then by the full Senate to be the next director of the Bureau. But his prepared remarks do provide a blueprint for the type of Bureau he envisions and what he views his role to be as the Bureau’s director.
It’s interesting to compare the prepared testimony of McKernan to that of Kathleen Kraninger, who went before the Senate Banking Committee back in 2018 to replace Richard Cordray and take over for Mick Mulvaney, who had been acting director. In her remarks, she laid out four priorities that she said aimed to satisfy the congressional mandate of the CFPB. In contrast McKernan’s remarks are aimed more at laying out all the ways in which he thinks the CFPB has overstepped its authority while laying out his visions in just two sentences:
“Under my watch, the CFPB will take all steps necessary to implement and enforce the federal consumer financial laws and perform each of its other statutorily assigned functions. But the CFPB will do this by centering its regulation on real risks to consumers and by focusing its enforcement on bad actors.”
You can watch the full confirmation hearing starting at 10am ET by clicking here
