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Senate panel approves Obama nominees to head SEC, consumer bureau

March 19, 2013|By Jim Puzzanghera
  • Richard Cordray, nominee for director of the Consumer Financial Protection Bureau, and Mary Jo White, nominee for chair of the Securities and Exchange Commission, are sworn in prior to testifying at a confirmation hearing before the Senate Committee on Banking, Housing and Urban Affairs last week.
Richard Cordray, nominee for director of the Consumer Financial Protection… (T.J. Kirkpatrick / Getty…)

WASHINGTON — A Senate committee on Tuesday overwhelmingly approved Mary Jo White's nomination to head the Securities and Exchange Commission, clearing the way for the former federal prosecutor to be confirmed soon as Wall Street's top watchdog.

The Senate Banking Committee also approved the nomination of Richard Cordray as director of the Consumer Financial Protection Bureau.

But that vote was split 12-10 along party lines, and the nomination is stalled because of the insistence of nearly all Senate Republicans that the bureau's structure be changed before they would allow a confirmation vote.

White enjoys bipartisan support for her nomination as the permanent replacement for Mary Schapiro, who stepped down in December. SEC Commissioner Elisse Walter was elevated to chairwoman and has been heading the agency since then.

The committee approved White's nomination 21-1. All the Republicans on the committee voted for her confirmation. The only opposition was from Sen. Sherrod Brown (D-Ohio), who has been critical of federal officials for not being more aggressive in prosecuting Wall Street firms.

Brown had tough questions for White at her confirmation hearing last week, pressing her on whether some banks were "too big to jail" and also on her work in the private sector over the past decade.

After serving as U.S. attorney for the Southern District of New York from 1993 to 2002, White moved to a top New York law firm. There, her clients included some big Wall Street firms and figures, such as former Goldman Sachs Group Inc. director Rajat Gupta and former Bank of America Corp. Chief Executive Ken Lewis.

White sought to assure Brown that she would be an aggressive SEC chair. If confirmed, she said, "the American public will be my client."

Brown said his vote was more of a general protest and did not indicate he would try to block her confirmation.

“I don’t question Mary Jo White’s integrity or skill as an attorney," Brown said. "But I do question Washington’s long-held bias toward Wall Street and its inability to find watchdogs outside of the very industry that they are meant to police."

"Mary Jo White will have plenty of opportunities to prove me wrong," he continued. "I hope she will.”

Sen. Mike D. Crapo (R-Idaho), the committee's top Republican, said he fully supported White's nomination. The full Senate could vote on White's nomination as soon as this week, and she is expected to be confirmed easily.

Crapo also reiterated the problems Senate Republicans have with the structure of the consumer bureau, which they said reduces congressional oversight and accountability.

Republicans are demanding that the bureau's single director position to be replaced by a bipartisan commission and its funding go through the congressional appropriations process rather than coming directly from the Federal Reserve.

Crapo stressed that the problem with Cordray's nomination was not specifically with him. Crapo noted he had a good meeting with Cordray.

"The issue with his nomination is the broader debate over the structural creation of a new federal department," Crapo said. "The CFPB structure needs to be revised to fit the model of traditional departments and agencies."

The White House and Senate Democrats oppose the changes to the bureau, which was created in 2010 as part of the overhaul of financial regulations. They noted that the structure is not significantly different than other banking regulators.

Cordray already is the director but was installed by a controversial recess appointment that expires at the end of the year. The appointment also could be in trouble legally after a federal court in January ruled that three other recess appointments made on the same day as Cordray were invalid.

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