In a surprising move, President Donald Trump over the weekend nominated Kathy Kraninger, a protégé of Office of Management and Budget director Mick Mulvaney, to lead the Consumer Financial Protection Bureau where Mulvaney is now acting director.
Kraninger was most recently associate director at the OMB, where she has been for about a year. She also was a staffer on the Senate Appropriations Subcommittee on Homeland Security and has also worked for the Department of Transportation.
CapAlpha’s Ian Katz told Politico that under obscure federal rules, Mulvaney would have had to leave the bureau by June 22 if no one had been nominated for the job. The Senate confirmation process will likely take months, said Katz, but Mulvaney can stay on the job now until it is over.
The confirmation process is expected to be highly contentious. That’s because critics have already lined up against Kraninger and are not mincing words.
“The CFPB has a strong track record of protecting consumers from abusive practices in the financial sector. Kathy Kraninger does not,” Andy Green, managing director of economic policy for the Center for American Progress, told MarketWatch.
Read: Mulvaney axes CFPB’s consumer advisory board
“With the choice of Kathy Kraninger, it is crystal clear that Mick Mulvaney wants to continue to pull the strings at the CFPB. In little more than six months of his improper leadership at the agency, Mulvaney has shut down enforcement, rolled back rules and demoralized staff – all to benefit big banks and predatory lenders. If Kraninger is confirmed, we should expect more of the same. The American people deserve better,” said Lisa Gilbert, vice president of legislative affairs, Public Citizen in a statement.
A key industry group supported the nomination. “Her experience at OMB alongside Acting CFPB Director Mick Mulvaney, along with her years of work on Capitol Hill and in the executive branch, would serve her well in this important position. We trust she shares our interest in ensuring consumers have access to the financial products they want and need, while maintaining the protections they deserve,” said the American Bankers Association in a statement.
Read: Warren questions ethics of CFPB’s Mulvaney in letter to agency lawyer
See also: What Mulvaney was really saying in the remarks about lobbyists that created a firestorm
Analysts KBW wrote on Monday, “Given Ms. Kraninger’s lack of a track record in financial regulation, it is difficult to identify specific issues on which she will focus and where there might be winners and losers.” KBW views the choice as generally positive for consumer lenders, “simply because we think she will continue the lead established by current Acting CFPB Director Mick Mulvaney to end the CFPB’s pattern of regulation by enforcement.”
KBW wrote a vote on her nomination could potentially not happen until 2019, leaving Mulvaney at CFPB for several more months. Kraninger’s nomination could be “imperiled,” says KBW if Democrats retake the Senate in 2019.