Russell Vought Takes Over as CFPB Acting Director, Closes Office for the Week, and Announces Plans to Cut off Funding; Trump Nominates Jonathan McKernan as Director
Last week, President Trump appointed Russell Vought as acting director of the Consumer Financial Protection Bureau (CFPB) after he was confirmed by the Senate a day prior to lead the Office of Management and Budget. Less than 36 hours after his appointment to the CFPB, Vought announced plans to cut the agency’s funding and closed its headquarters for the following week.
Vought wrote on X that the CFPB “has been a woke and weaponized agency against disfavored industries and individuals for a long time,” according to the New York Times. He also stated that he “notified the Federal Reserve (Fed) that CFPB will not be taking its next draw of unappropriated funding because it is not ‘reasonably necessary’ to carry out its duties,” according to The Hill.
Bureau employees were told via email to stop supervision and examination activity, cease pending investigations, and halt public communications and enforcement actions. Since the agency is a creation of Congress, it would need a separate act of Congress to officially eliminate it, but the CFPB director has discretion over what enforcement actions it takes.
The CFPB was created in response to the 2007-2008 financial crisis, and has the ability to issue new rules and hold companies accountable to follow them, as they directly affect the financial lives of Americans. “Vought is giving big banks and giant corporations the green light to scam families,” said Senator Elizabeth Warren (D-Mass.), according to the Associated Press.
While Vought will serve as Acting Director until a permanent replacement is confirmed by the Senate, on Tuesday the White House nominated Jonathan McKernan, a former member of the Federal Deposit Insurance Corporation (FDIC), to serve as the full-time CFPB director. He previously served as counsel to the Senate Banking Committee, and was senior counsel at the Federal Housing Finance Agency, as well as a Treasury Department adviser.
