Today is the day where we finally get to hear Kathy Kraninger speak. Today is the day where she will sit before the Senate Banking Committee and answer questions about her qualifications to be the next director of the Bureau of Consumer Financial Protection. The hearing will be streamed live, starting at 10am ET and can be viewed by clicking here.
Not much was known about Kraninger before she was nominated last month by President Trump to be the next director of the BCFP. We knew she was an associate director at the White House Office of Management & Budget, where she worked under Mick Mulvaney, who has been the acting director of the agency for the past eight months following the resignation of Richard Cordray. We knew a little bit about where she has worked in the past. But unlike Cordray, who was a state attorney general before he was nominated to run the bureau, and Mulvaney, who was a Congressman, most of what Kraninger has done has been done behind the scenes and out of the public eye.
Judging by a lot of what has been published about the types of questions that Kraninger can expect to face during her confirmation hearing, it is unlikely that the words “debt collection” will be spoken. It seems as though the Senators — at least the Democrats on the committee — will try to tie Kraninger to some of the Trump administration’s questionable decisions and policies, such as the response to Hurricane Maria and the decision to separate children of immigrants from their parents when attempting to enter the United States illegally.
It is likely that she will face a number of questions about her lack of experience in anything related to consumer protection and questions about how she will run the BCFP differently than either of her predecessors and those answers will be important barometers for how the debt collection industry can expect to be treated by a BCFP run by her.
What might matter most, however, is not her answers to those questions but how she answers those questions. Cordray and Mulvaney both had talent at handling questions from members of Congress, whether they were deflecting partisan questions or trying to provide honest answers to legitimate questions. How Kraninger responds to questions, especially from Democrats, will likely go a long way into determining whether her tenure at the BCFP is over before it ever started.
In her prepared testimony, Kraninger said she would have four priorities as director of the BCFP:
- To be fair and transparent. “In particular,” she writes, “the Bureau should make robust use of cost benefit analysis, as required by Congress, to facilitate competition and provide clear rules of the road. In my experience, effective use of notice and comment rulemaking is essential for ensuring the proper balancing of all interests. It also enables consideration of tailoring to reduce the burden of compliance, particularly on consumers and smaller marketplace participants.”
- To work closely with other regulators at the federal and state levels. “Under my stewardship, the Bureau will take aggressive action against bad actors who break the rules by engaging in fraud and other illegal activity.”
- To protect sensitive information by limiting data collection. “Under my leadership, the Bureau would limit data collection to what is needed and required under law and ensure that data is protected. This issue clearly needs more attention, particularly because many consumers are unaware of the vulnerabilities or unsure of what actions to take to protect themselves.”
- To be accountable to the American people, especially as it relates to how the BCFP spends its money.
Many of these priorities echo those said by Mulvaney during his time as acting director.