CFPB Director Absolved of Possible Hatch Act Violations
In a recent letter, the United States Office of Special Counsel (OSC) found that Consumer Financial Protection Bureau (CFPB) Director Richard Cordray did not violate the Hatch Act, a federal law that prohibits federal employees from engaging in certain political activities.
The investigation into Cordray stems from comments made by an Ohio Supreme Court justice named Bill O’Neill who said that he had a friend reach out to Cordray concerning the prospects of the CFPB director running for governor of Ohio. If Cordray was anticipating a run, O’Neill would stay out of the race.
Over the past 6 months, Cordray has fielded countless questions about his intentions on running for office in the Buckeye State. Rep. Jeb Hensarling (R- TX), Chairman of the House Financial Services Committee, repeatedly asked Cordray about his plans, even encouraging the embattled director to quit his federal post and return to Ohio politics. Cordray responded with, “You ask whether I intend to serve my full statutory term. At this time, I have no further insights to provide on that subject.”
Many expected Cordray to announce his candidacy at a picnic over Labor Day in Cincinnati. No announcement came that day. Others bet that Cordray would leave shortly after issuing the agency’s new rule on small dollar loans, but he remains in his position.
Ohio Supreme Court Justice O’Neill, the man whose comments sparked the investigation into Cordray, relayed last week that he would file to run for governor in February… unless of course, Cordray joins the fray before then.
Cordray’s ouster from the CFPB would be a boondoggle for Congressional Republicans and President Trump’s administration, each of which is constantly at odds with the Bureau chief. A report by the U.S. Dept. of the Treasury in October criticized the CFPB for their analysis when drafting a recently-published rule on mandatory arbitration. A House Financial Services Committee staff report in September chronicled Cordray’s mishandling of the Wells Fargo bank account scandal. Seeing Cordray leave the CFPB could lead to a significant change in regulatory and enforcement agenda at the agency.