Trump to Withdraw Nominee to Lead Consumer Bureau
President Trump plans to drop his nomination for Jonathan McKernan to lead the Consumer Financial Protection Bureau, leaving the agency in the hands of a temporary director as Mr. Trump's officials work to gut the agency.
The Treasury Department said Friday that the president instead planned to nominate Mr. McKernan to serve as the department's under secretary of domestic finance. Mr. McKernan was nominated in February to serve as the consumer bureau's director and testified that month at a confirmation hearing before the Senate Banking Committee. His nomination was approved by the committee but had not yet been taken up by the full Senate.
A White House representative said the president intended to rescind that nomination and instead have Mr. McKernan fill the Treasury role.
Russell T. Vought, the White House budget office director, has been the consumer bureau's acting director since early February. He has frozen most of the agency's operations and sought to fire 90 percent of its staff — a move federal courts have temporarily blocked. A three-judge panel from the U.S. Court of Appeals for the District of Columbia Circuit is scheduled to hear oral arguments for that case next week.
Also on Friday, the consumer bureau released a formal notice of its intention to withdraw more than 60 policy statements and guidance documents. Doing so would serve the public interest by reducing compliance demands on the companies the bureau regulates, Mr. Vought said in the notice.
Banking trade groups praised the guidance purge, while consumer advocates responded with alarm.
Better Markets, an advocacy group that favors financial industry oversight, said Mr. Vought's move was likely a first step in dismantling the agency's consumer complaints database, which helps people pursue claims against companies over financial disputes. Consumers have collected hundreds of millions of dollars in refunds and other relief in response to complaints filed with the consumer bureau.
'This is a calculated demolition of the tools consumers and advocates rely on to protect themselves from financial abuse,' said Brady Williams, a lawyer for Better Markets.
The American Bankers Association said it was pleased to see the agency drastically pare back its guidance. Those documents were intended to help companies understand how the agency interpreted various laws, but the consumer bureau often used them as a form of stealth rule making, the banking group said.
'This misuse of guidance creates unnecessary confusion for regulated entities,' said Rob Nichols, the group's chief executive. 'We're hopeful that today's action marks a turning point.'
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