WASHINGTON, DC-On July 21, the Consumer Financial Protection Bureau will formally open its doors. It will be, as its creator, Harvard professor Elizabeth Warren recently said in a prepared statement, “a cop on the beat--examining banks and protecting consumers.” Now the Obama administration has announced the top cop, so to speak, at the agency: former Ohio attorney general Richard Cordray. It is a telling political choice for the administration, which apparently did not have the stomach to see through a Senate confirmation for Warren. But it is a savvy choice as well, as Cordray is likely to prove to be just as much of a foil to the financial industry as it was feared Warren would be.

Six months ago Cordray lost his seat in the November elections to Republican Mike Dewine. At the time he was among the most aggressive of the attorney generals investigating the latest scandal to emerge from the mortgage crisis--the false affidavits submitted by so-called robo-signers. He also held the hardest line among the attorney generals as they negotiated for settlements with the mortgage companies over this and other related issues.

Even if the Obama administration had tapped a more moderate policymaker the bureau’s mission and powers will likely remain in the sights of Republicans unhappy that the CFPB was created in the first place, as part of the Dodd-Frank financial reform law. Critics in the House and Senate over the months have taken aim at its funding, its independence and its governing structure.
Warren, though, seems to feel the bureau has popular opinion on its side. In a recent interview with the political newspaper, the Hill, Warren pointed to the response the CFPB received in one of its first initiatives in May: it posted two drafts of a mortgage disclosure form on its website and asked the public to give its opinion as to which was the easiest to read and understand. It received more than 100,000 visitors and 14,000 responses, the Hill said.

More recently, the CFPB outlined what will be its approach to supervising large depository institutions. Briefly, the Dodd-Frank Wall Street Reform and Consumer Protection Act streamlined consumer protection oversight authority under the CFPB--a huge portion of which will include bank examinations and oversight. In a release outlining its plans, CFPB said its supervision will be an on-going process of pre-examination scoping and review of information, data analysis, on-site examinations as well as follow-up monitoring. For most of the banks, only periodic examinations will be conducted, but for the largest the agency will implement a year-round supervision program.