President Obama has tapped Richard Cordray to head the nascent Consumer Financial Protection Bureau (CFPB), leaving everyone wondering, “Who’s Richard Cordray?”
Obama’s pick has a low national profile, but he has a long political history in his native Ohio, where’s he’s been a faithful Democrat. Before becoming the state attorney general in 2009, Cordray was Ohio’s state treasurer, state solicitor and a Democrat member of the Ohio House of Representatives.
So far, the pick has been met with polite applause from consumer groups and the left, who would have preferred firebrand Elizabeth Warren, and unease from the right. Some critics of the CFPB don’t have a beef so much with Cordray as with the office he will occupy and its broad powers.
“The CFPB is just another layer of government regulation added to an already over-regulated nation,” said Club for Growth spokesman Barney Keller in an email. “Richard Cordray is just another foot-soldier in Obama’s war on economic freedom.”
The U.S. Chamber of Commerce is also wary of Cordray.
“We have deep concerns about how [Cordray] would use [the CPFB’s] new broad powers,” said David Hirschmann, president and CEO of the Chamber’s Center for Capital Markets Competitiveness. “We have seen efforts to regulate the mortgage industry through enforcement settlements rather than by engaging in a deliberative, fair, transparent rule-making […] We also have concerns about how the new agency will preserve consumer choice and access to credit for small businesses. We will need to understand where Mr. Cordray stands on these issues.”
When the Chamber talks about enforcement settlements, it’s referring to Cordray’s work as attorney general of Ohio, where he’s made a name for himself by taking on big banks and mortgage companies.
In 2009, Cordray, representing 26 Ohio universities, cities and schools, reached a $9 million settlement with American International Group (AIG) in a bid-rigging case. He also was the lead plaintiff in a class-action lawsuit initiated by five public pension funds against Bank of America.
He is regarded on both sides of the aisle as an intelligent, party-line Democrat who keeps his nose clean.
“Cordray is known as a smart guy,” said one Ohio Republican strategist. “His enemies and his guys will say he’s smart — whether ‘Jeopardy!’ or Supreme Court clerk smart.”
After graduating from the University of Chicago Law School in 1986, Cordray clerked for Supreme Court associate justices Byron White and Anthony Kennedy. He was also a five-time undefeated “Jeopardy!” champion.
“He was known as the baby-face that won ‘Jeopardy!’,” said Bob Kish, an Ohio political consultant. “He’s an Obama ideologue, but he doesn’t have a bunch of junk in his background. He’s straitlaced.”
Of course, the bar for Cordray as attorney general was set fairly low. Marc Dann, his predecessor as Ohio attorney general, was, in the words of the Ohio Republican strategist, a “corrupt, unethical boob.” Dann resigned in the midst of sexual harassment scandal and allegations of cronyism, leaving the attorney general’s office in disarray.
Cordray was elected to succeed him. He cleaned up the office and began pursuing high-profile cases. But while Cordray has stayed on the right side of the law throughout his career, he has had a penchant for self-promotion.
During his time as Ohio treasurer, Cordray made the unusual decision to have Ohioans write checks directly to him, Richard Cordray, rather than the treasurer’s office. The Cleveland Plain Dealer called the move “both transparently political and in questionable taste.”
“On the self-promotional scale, this idea sails out of the stratosphere,” the paper editorialized.
And while Cordray was attorney general, the office’s public relations department was a $1.5 million-a-year operation, and he created positions like “new media strategist” and “senior new media designer.”
Cordray is also a stolid Democrat. He campaigned for Obama in Ohio during 2008, and he supported Dann (pre-scandal). And when his big case against Bank of America needed a co-counsel, Cordray chose the firm of Montgomery County Democratic Chairman Dennis Lieberman — a friend of Cordray’s for 16 years.
He also offered free legal support to three state officials — one of whom was a prominent Obama donor — who snooped through confidential state databases in search of information about Joe Wurzelbacher, nicknamed “Joe the Plumber.”
Cordray’s moved up the political ladder by making a name for himself while toeing the party line.
“He’s kind of just there,” Kish said.
And by all indications, Cordray will continue to be there.
“Right now, my focus will be big banks,” he said in an interview with the Plain Dealer about his new position at the CFPB.
Which is a bit funny in light of his private sector work defending corporate interests. After his time as a Supreme Court clerk, Cordray spent a couple years at mega-law firm Jones Day, which represents such companies as Bank of America, JP Morgan, Pfizer and RJ Reynolds Tobacco Company.
His former clients will probably not be keen on running into him again.