[Congressional Record Volume 157, Number 187 (Wednesday, December 7, 2011)]
[Senate]
[Page S8401]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


                     NOMINATION OF RICHARD CORDRAY

  Mr. DURBIN. Mr. President, experts blame credit default swaps and 
collateralized debt obligations for the financial crisis. The fact is, 
these complicated financial products were based on mortgages sold to 
families who couldn't afford them, credit cards with hidden fees, and 
loans targeted to low-income individuals with up to 400 percent 
interest rates. The financial regulators ignored their responsibility 
to protect consumers from these predatory practices. Because there was 
not one regulator solely responsible for consumer protection, the 
financial regulators pointed their fingers at the other guy when the 
system collapsed. Consumers lost $17 trillion in household wealth and 
retirement savings almost overnight.
  That is why a bipartisan group of 60 Senators voted last year to 
consolidate consumer protection authority into one agency: the Consumer 
Financial Protection Bureau. The CFPB was given new responsibilities to 
oversee nonbank actors who deal in payday loans, prepaid cards, student 
loans, and credit reporting.
  Mr. President, 200 million Americans rely on credit reporting 
agencies when they make a big purchase and sometimes when they apply 
for a job. An estimated 20 million people use payday lenders to make 
ends meet. I wish they didn't, but they do. Many of them face up to 400 
percent interest rates to obtain these short-term loans. Four million 
Americans have prepaid debit cards. As more companies use these types 
of products instead of checks or direct deposit, it is expected that 
over $670 billion will be loaded into prepaid cards in the next few 
years. More than $10 billion in private student loans is given to 
students, who then face up to 15 percent interest rates. I talked about 
a few of them in an earlier statement.
  Tens of millions of Americans relying on nonbanks for their financial 
needs will go without protection unless the Consumer Financial 
Protection Bureau has the resources it needs to help American consumers 
and a Director.
  Earlier this year, President Obama nominated Richard Cordray to be 
Director of the Consumer Financial Protection Bureau. He was recruited 
to lead the Enforcement Division and now is being asked to move up and 
take over the directorship. Before joining, he served as Ohio's 
attorney general, recovering billions of dollars in pension funds on 
behalf of retirees and taking on the predatory lenders. Mr. Cordray saw 
firsthand how the failure to enforce Federal consumer protection laws 
related to mortgages affected Ohio residents. He has a strong 
grounding, working with both consumer advocates and the financial 
sector. He is an excellent choice, and I strongly support his 
nomination.
  Unfortunately, Mr. Cordray is asking to head up a consumer protection 
agency which, to paraphrase a former colleague on the floor, the banks 
hate like the devil hates holy water. The idea that we would give 
authority to an agency to watch these financial institutions--payday 
loan operations and the rest--to make certain they don't exploit 
American consumers drives these banking interests wild. They have done 
everything they can to stop him from becoming Director and to cut the 
money available for his Bureau. They don't believe there should be 
consumer protection. Let the buyer beware. They don't care, at the end 
of the day, if innocent people suffer across America. But they should.

  My colleagues claim there won't be any real checks on his power if 
Mr. Cordray is given this position, but he is subject to an annual 
audit by the GAO; he has to report to Congress biannually; is subject 
to private sector independent audit; monitored by the inspector general 
of the Federal Reserve; the Comptroller General is required to annually 
audit the financial transactions of the Bureau; and is subject to the 
Regulatory Flexibility Act, the Paperwork Reduction Act, the Congress 
Review Act, and the Administrative Procedures Act, to name a few. The 
Financial Stability Oversight Council that includes members from across 
the financial sector can review and overturn CFPB regulations. No other 
agency is subject to having regulations under its own jurisdiction 
overturned. But that isn't enough for the special interests that hate 
the Consumer Financial Protection Bureau. These are the same players 
who helped create the financial crisis that devastated our economy.
  Despite all these measures to ensure congressional oversight, those 
who couldn't kill the CFPB outright are determined to destroy its 
ability to act. And now, as we finally start to recover from this 
economic crisis, the same special interests are protesting efforts to 
require the disclosure of credit card fees, for example. The same banks 
that made billions from selling homes to families who couldn't afford 
them are refusing to modify mortgages so families can stay in their 
homes. They don't want to change the structure of the CFPB; they want 
to destroy its ability to protect America's consumers and families. 
They want to go back to the days of ``heads I win, tails you lose,'' 
back to the days when we didn't have to worry about a regulator 
enforcing consumer protection laws.
  The CFPB structure is similar to other financial regulators. The 
Office of the Comptroller of the Currency has been led by one 
individual with congressional oversight for over 100 years, for 
example. The Federal Housing Finance Agency, which oversees Fannie Mae 
and Freddie Mac, is also led by a single Director with congressional 
oversight. Yet both financial regulators have avoided the political 
outcry we are hearing about the Consumer Financial Protection Bureau.
  Really, what we are seeing, I am afraid, is a partisan effort to 
block a well-qualified nominee. Many intelligent, decent, and hard-
working Americans volunteer to contribute as appointed public servants. 
They are well qualified, but all too often these days, they can't get 
through the Senate. This has serious consequences on all Federal 
agencies and our judiciary.
  Yesterday, we saw an incredibly astonishing Republican filibuster of 
the nomination of Caitlin Halligan to serve in the DC Circuit Court of 
Appeals. The fact is, those voting against her nomination couldn't come 
up with a good reason. She had been found by the ABA to be unanimously 
``well qualified,'' she had an amazing resume, and she was rejected on 
a filibuster initiated by the Republican side. That is unfortunate.
  I would just say to my Senate Republican colleagues that I think 
Richard Cordray has the background and experience to lead this agency. 
He should be given a chance. I know the banks aren't happy that anybody 
is watching them. These financial institutions--payday lenders and the 
rest--would rather do their business without anybody looking over their 
shoulders.
  Holly Petraeus is the wife of General Petraeus. She has been working 
with the Consumer Financial Protection Bureau to stop the exploitation 
of men and women in military service. She came by my office to talk 
about what this agency is doing to protect these families. Sadly, some 
of these families are exploited so badly that they are forced out of 
the military and have to be discharged. We don't want that to happen. 
We don't want it to happen to American families who unsuspectingly find 
themselves lured into financial arrangements that are totally unfair.
  Richard Cordray is competent, qualified, and an honorable public 
servant. He deserves an up-or-down vote. We are going to have that vote 
probably tomorrow, and I hope he will be confirmed and given an 
opportunity to lead this important agency.
  Mr. President, I yield the floor.
  Mr. THUNE. Mr. President, I ask unanimous consent that when I 
complete my remarks, the Senator from Wyoming, Mr. Barrasso, be allowed 
to follow me.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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