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CFPB Director Kraninger Resigns At Biden’s Request (1)

Jan. 20, 2021, 5:59 PM; Updated: Jan. 20, 2021, 6:52 PM

Consumer Financial Protection Bureau Director Kathy Kraninger announced her resignation Wednesday.

Kraninger, a Trump appointee who won Senate confirmation to the position in December 2018, submitted her resignation less than an hour after President Biden’s inauguration and at the president’s request. She intends to leave immediately.

“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,” Kraninger wrote in a letter to Biden.

Biden was expected to fire Kraninger if she did not leave of her own accord. The U.S. Supreme Court’s June decision in Seila Law LLC v. CFPB made the director of the independent, self-funded agency an at-will employee of the president by removing for-cause removal protections.

Biden on Jan. 18 announced that he would nominate Federal Trade Commission Commissioner Rohit Chopra, the CFPB’s former student loan ombudsman, to a five-year term as the bureau’s director. It’s unclear whether Biden will tap Chopra to take over the CFPB on an acting basis, or name another official.

During Kraninger’s tenure, the CFPB scaled back regulations for the payday lending industry, finalized rules for the debt collection industry, and made a host of other changes to consumer finance regulation.

Biden was expected to fire Kraninger if she did not leave of her own accord. The U.S. Supreme Court’s June decision in Seila Law LLC v. CFPB made the director of the independent, self-funded agency an at-will employee of the president by removing for-cause removal protections.

The CFPB under Kraninger’s tenure also saw a slowdown in enforcement when compared with the CFPB’s Obama-era director, Richard Cordray.

Under Kraninger’s two-year tenure, the CFPB collected around $1.5 billion in consumer relief. Cordray’s CFPB secured more than $12 billion in consumer relief over more than five years.

To contact the reporter on this story: Evan Weinberger in New York at eweinberger@bloomberglaw.com

To contact the editor responsible for this story: Michael Ferullo at mferullo@bloomberglaw.com

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