Gary Gensler in 2013.
Photographer: Andrew Harrer / Bloomberg
Photographer: Andrew Harrer / Bloomberg
Elected President Joe Biden has selected some veteran regulators who are strongly backed by progressive Democrats to lead two major Wall Street watchdogs, indicating that his government is planning a tough overhaul after four years of light policies under President Donald Trump .
Former Commodity Futures Trading Commission Chairman Gary Gensler will be named to the Securities and Exchange Commission en The member of the Federal Trade Commission, Rohit Chopra, is being tapped to become the leader of the Consumer bureau for financial protection, according to people familiar with the decision.
The election follows weeks in which parties within the parties wrestled over the financial regulatory posts between moderate Democrats and those on the left wing of the party who want to see a sharp departure from the business-friendly policies pursued during the Trump administration. This is bad news for the banking industry, which has been opposed to the prospect of tighter rules since the Biden election in November.
Gensler (63) is a former Goldman Sachs Group Inc. partner who gained a reputation as a plague on Wall Street when he struggled with bruises while promoting derivative regulations at CFTC during the Obama administration. Chopra, 38, is an acolytic from Massachusetts Senator Elizabeth Warren who helped her draft the CFPB before she ran in her election.
Both nominees will be confirmed by the Senate, and the SEC and CFPB are likely to be among interim leaders until the process is completed.
The chances of Gensler and Chopra winning the confirmation were significantly helped by the Democrats who won two Senate by-elections in Georgia this month, resulting in a 50-50 split. Upcoming Vice President Kamala Harris will hold the casting vote if all Republicans oppose Biden’s financial watchdogs. It could thwart any attempts by the powerful banking portal to stop Gensler and Chopra, whose nominations would come before the Senate Banking Committee.
Photographer: Alex Edelman / Bloomberg
If confirmed, Gensler will take control of an agency that some Democrats say is too bank-tight. He will immediately have to address market disruptions due to the coronavirus pandemic and the growing US feud with China over public company audits.
Democrats will expect Gensler to strive for stricter enforcement and greater fines for financial businesses and executives accused of wrongdoing. He will also face pressure to push companies to publicize political spending, climate change risks and diversity and inclusion.
Progressive people will look to Chopra to raise a CFPB that they say has become a toothless version of the agency he helped create. In his first term with the agency, he was the ombudsman for student loans. This experience can come in handy when he bids Biden’s promise to curb private lenders that mislead student lenders.
The Warren-bound Progressive Change campaign committee said the choice of Chopra ” is a major victory for consumers and a sign that executive power will be used to achieve tangible results for the American people. ”
– With help by Robert Schmidt
(Updates to Senate Confirmation Opportunities Begin in Sixth Paragraph)