Richard Cordray, a target of the banking industry and Republicans in Congress, announced Wednesday that he plans to step down as head of the Consumer Financial Protection Bureau by the end of the month.
Cordray’s resignation will give President Trump an opportunity to reshape an agency that oversees a significant portion of the financial industry. It comes less than a month after the agency suffered a stunning rebuke when Congress voted to block one of its most aggressive regulations allowing consumers to sue their banks.
“I wanted to share with each of you directly what I have told the senior leadership in the past few days, which is that I expect to step down from my position here before the end of the month,” Cordray said in a message to employees.
“As I have said many times, but feel just as much today as I ever have, it has been a joy of my life to have the opportunity to serve our country as the first director of the Consumer Bureau by working alongside all of you here.”
The bureau, known as the CFPB, was one of the central achievements of the Obama administration following the 2008 financial crisis. It regulates the way banks and other financial companies interact with consumers, policing everything from payday loans to mortgages. It has extracted billions in fines from big banks, including $100 million from Wells Fargo last year for opening millions of sham accounts that customers didn’t ask for.
But the agency has been controversial among Republicans since its inception. Critics argue that CFPB has made it more difficult for people to get a mortgage loan and has overstepped its power to regulate some industries, including auto loans.
Within minutes of Cordray’s public announcement, one of the CFPB’s staunchest critics, Rep. Jeb Hensarling (R-Tex.), chairman of the House Financial Services Committee, cheered the move.
“We are long overdue for new leadership at the CFPB, a rogue agency that has done more to hurt consumers than help them,” said Hensarling, who has touted legislation that would strip the agency of many of its powers. “The extreme overregulation it imposes on our economy leads to higher costs and less access to financial products and services, particularly for Americans with lower and middle incomes.”
Cordray’s decision is likely to renew speculation that he will run for governor of Ohio, where he once served as attorney general. His term does not end until next summer, but to run he would have to declare his candidacy by February. Even as Cordray has declined to answer questions about his political ambitions, his opponents began to galvanize against him. One website, www.cordray2018.com, initially appears to be pro-Cordray and features a “Cordray for Ohio” slogan at the top and a large picture of the Democrat. But then the site attacks him and calls the CFPB “one of America’s most corrupt government agencies.”