‘I am very excited to be here’: Kraninger signals new tone atop CFPB

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WASHINGTON — Kathy Kraninger's first public remarks Tuesday as the new head of the Consumer Financial Protection Bureau struck a more moderate tone than that of her predecessor, acting Director Mick Mulvaney, who at times questioned the role of the agency he was chosen to lead.

Kraninger, who had reported to Mulvaney at the Office of Management and Budget, said she planned to start a three-month listening tour with agency stakeholders, and will make a decision soon regarding attempts to change the agency's name.

"I am incredibly grateful to Mick Mulvaney, he was a fantastic boss for two years. I loved my time at OMB. But I can tell you that I am here to be the director of this bureau and I will be fully accountable for the decisions that I make going forward and they will be mine,” Kraninger said in a briefing with reporters one day after being sworn in to a five-year term.

Andrew Harrer/Bloomberg

Kraninger, whose nomination was strongly opposed by congressional Democrats, said she is still in the early stages of meeting with senior staff at the agency, including both the political appointees put in place by Mulvaney and career staff.

“Each division of the bureau has a lot of ongoing activities and I’ve told the staff that I will be spending the next three months engaged in a listening tour, getting out to the field. … That is essentially where we are here. I am very excited to be here. The staff is excited to have a full-time director,” Kraninger said.

Her comments were more restrained than Mulvaney's first remarks following his November 2017 appointment. In a rebuke of the former director, Richard Cordray, an Obama appointee, Mulvaney — a vocal critic of the CFPB — said at the time that the agency would be "dramatically different" with new leadership, and that the White House wanted him to "fix" the agency.

That said, many observers believe Kraninger may continue Mulvaney's policies. In charge of the agency for a little over a year, Mulvaney took steps to soften the blow of CFPB enforcement; ease rules for payday and mortgage lenders; reduce the impact of fair-lending policies; put in place a dozen political appointees to run the agency's daily operations; and change the name of the agency to the Bureau of Consumer Financial Protection, or BCFP.

One of Kraninger's immediate tasks is deciding whether further action is necessary in dealing with Eric Blankenstein, the CFPB’s policy director for supervision, enforcement and fair lending. He has drawn ire from consumer advocates and career agency staff over racially insensitive blog posts he wrote more than a decade ago.

Kraninger would not comment on Blankenstein's future at the agency, but said personnel conversations will be conducted privately.

“I do recognize that the concerns have been out there,” Kraninger said. “I will take people at face value. … I’m not going to go back and look at everything they’ve ever written in their lives.”

There have been reports that Mulvaney’s plans to change the name of the CFPB could cost the financial services industry close to $300 million. Kraninger said that she understands Mulvaney was trying to follow the statute when changing the agency’s name, but that she is aware of the importance of the CFPB.

She said that "given the CFPB brand and the identity of employees," some at the agency "were all caught off guard by" the name change.

"Many continue to be concerned about it and want to make sure again that consumers know the brand of this agency,” Kraninger said. “There are resource implications, frankly, of going from CFPB to Bureau for Consumer Financial Protection, and then going back to it, so again there are resource implications here that I will weigh."

“It’s a near-term decision, frankly, because the name change as you see is certainly partially done, but it is not fully completed yet,” she added.

Kraninger’s nomination and Mulvaney’s tenure at the CFPB were sharply criticized by Rep. Maxine Waters, D-Calif., the ranking member of the House Financial Services Committee, who will likely chair the panel when Democrats are in the majority in the next Congress. Waters has indicated that she tends to hold the agency accountable for its mission of protecting consumers.

Kraninger said she is working to set up a conversation with Waters shortly and that she also hopes to speak with Cordray, whose tenure was harshly criticized by Republicans over his aggressive enforcement agenda.

Kraninger said the CFPB enforcement tools are “fundamental to the agency’s mission,” but she also offered support to Mulvaney's efforts to scale back enforcement.

“Regulation by enforcement is certainly pushing the envelope as members saw it, as I saw it,” she said. “And I think there is a responsibility here to make sure that the law is clearly articulated in the regulations and that that is what the bureau is enforcing."