Prepare for a return to Cordray-era CFPB

Washington D.C

A “sick, sad joke.”

That’s the phrase a former Trump administration appointee for the Consumer Financial Protection Bureau, Acting Director Mick Mulvaney, used to describe the government agency he was later selected to lead.

President Donald Trump kept Mulvaney in his role for as long as possible, only nominating Kathy Kraninger at the end of the legally allowed 120-day period. Though Kraninger proved to be far less of a firebrand than Mulvaney, her stint as director was characterized by a far more business-friendly approached than had been seen under the Obama administration.

Under former CFPB Director Richard Cordray, regulation by enforcement, or the act of defining where the line was after a company had already crossed it, was the name of the game. Cordray believed that if you never defined the line, lenders would be much less likely to cross it.

With President Joe Biden now seated in the Oval Office, the CFPB is poised to turn back the block. Cordray believes the next four years could look a lot like his time in office, when he was sheriff of one of America’s most powerful regulators.

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