Kraninger Steps Down as CFPB Director

Consumer Financial Protection Bureau Director Kathy Kraninger announced her resignation on Jan. 20, paving the way for President Joe Biden’s nominee, Rohit Chopra, to take over the agency.

“As requested by the Biden administration, today I resigned as Director of the CFPB,” Kraninger tweeted. “I am proud of all that we accomplished on behalf of consumers. It has been an honor to lead the agency during these challenging times.”

In a letter to Biden yesterday, Kraninger wrote, “I support the Constitutional prerogative of the President to appoint senior officials within the government who support the President’s policy priorities, which ensures our government is responsive to the will of the people as expressed in presidential elections.”

That paragraph was in reference to a U.S. Supreme Court case, Seila Law v. Consumer Financial Protection Bureau, in which the Trump Administration successfully argued that, contrary to the intent of the Dodd-Frank Act (which established the Bureau), the CFPB Director could be fired at will instead of for cause. That decision, ironically, allowed Biden to ask for Kraninger’s immediate resignation, instead of having her serve out her entire five-year term through 2023.

Chopra is expected to step in immediately, possibly even before his nomination goes before the U.S. Senate. Chopra worked with now Sen. Elizabeth Warren, D-Mass., in creating the CFPB and in 2011 served as its Student Loan Ombudsman before becoming the Bureau’s Assistant Director. He led efforts to spur competition in the student loan financing market, develop new tools for students and student loan borrowers to make smarter decisions and secure hundreds of millions of dollars in refunds for borrowers victimized by unlawful conduct by loan servicers, debt collectors and for-profit college chains. He also served as Special Advisor at the Department of Education. Chopra is currently a member of the Federal Trade Commission.