Regulatory Nominees Who Got Congressional Drubbings
March 28, 2013 10:20 AM
Never before have Washington's bitter bipartisan battles created a more contentious environment for would-be financial regulators who make their way up Capitol Hill seeking Senate approval. That's the popular notion, anyway. In truth, the Congressional approval process has long been fraught for financial regulators, as the following examples illustrate. (Image: Bloomberg News)
Richard Cordray
Richard Cordray currently leads the Consumer Financial Protection Bureau, thanks to a controversial presidential recess appointment. President Obama's re-nomination of the former Ohio attorney general to run the CFPB has rekindled a fierce bipartisan battle. GOP resistance to Cordray's nomination has less to do with qualms about him personally than it does with the party members' angst about the new agency itself. (Image: Bloomberg News)
M. Danny Wall
Danny Wall chaired the Federal Home Loan Bank Board when Congress passed the 1989 Financial Institutions Reform, Recovery, and Enforcement Act. The law moved many of the FHLBB's duties into the new Office of Thrift Supervision and mandated that the FHLBB chair would take over as the first OTS director without having to brave a separate nomination. Wall faced scrutiny over his role in the government's response to the thrift crisis, as well as the bid to dispense with the Senate confirmation process. Democratic criticism eventually helped force him to resign.
T. Timothy Ryan Jr.
Timothy Ryan, who was nominated to be OTS director after Wall's resignation, ultimately did become the thrift agency's first Senate-confirmed director in 1990. But Ryan still faced tough questions during his nomination hearing. They included queries about whether he had enough experience with banking issues to run the new agency at what was a critical juncture. In the end, 37 senators voted against his confirmation. (Ryan recently stepped down as head of the Securities Industry and Financial Markets Association.)
John D. Hawke Jr.
Hawke's path to become Comptroller of the Currency hit a speed bump when Paul Sarbanes, D-Md., ranking minority member of the Senate Banking Committee at the time, placed a hold on the nomination and delayed a vote. Democrats had concerns about Hawke's positions on numerous consumer-related issues, including the Community Reinvestment Act. Hawke initially served for 10 months starting in late 1998 under a recess appointment by President Clinton. He eventually held the Comptroller of the Currency position for six years ending in 2004. (Image: Bloomberg News)
Mark Brickell
The nomination of Mark Brickell to lead the Office of Federal Housing Enterprise Oversight, the predecessor to today's Federal Housing Finance Agency, languished for nearly all of 2003 over Democratic concerns most vocally expressed by Paul Sarbanes. The main Democratic gripe: that Brickell was not a sufficiently vigorous supporter of strong regulation. Brickell withdrew his name from contention in January 2004.
Joseph Smith
Smith was the Obama administration's initial choice to become the first Senate-confirmed director of the FHFA but quickly faced questions from congressional Republicans about his independence. Sen. Richard Shelby, R-Ala., who along with five other GOP members objected to Smith's nomination, famously called the former North Carolina banking commissioner a "lapdog" and "tool" of the administration. Smith, who withdrew in early 2011, now monitors the multi-state settlement over mortgage servicing failures. No successor nominee has been named to run the FHFA, which is currently run by Acting Director Edward DeMarco. (Image: Bloomberg News)
Ed DeMarco
DeMarco has never been nominated to run the FHFA. But as its de facto leader of the agency that oversees mortgage giants Fannie Mae and Freddie Mac, he has had a persistently rocky relationship with certain Democratic members of Congress, who object to some of his policies. Forty-five House members wrote to President Obama last month criticizing DeMarco's tenure and calling for a nominee to a permanent position that would replace the controversial acting director. (Image: Bloomberg News)
Peter Diamond
The Obama administration proved unsuccessful in three of its bids to nominate Nobel-prize winning economist Peter Diamond to a seat on the Federal Reserve Board. Leading the Republican opposition was Richard Shelby, who said the focus of Diamond's work on labor issues did not qualify him for a post with the central bank. Diamond withdrew his name from consideration once and for all in June 2011. (Image: Bloomberg News)
