More On Legal & Compliancefrom The Advisor's Professional Library
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- Anti-Fraud Provisions of the Investment Advisers Act RIAs and IARs should view themselves as fiduciaries at all times, whether they meet the legal definition or not. Deviating from the fiduciary standard of full disclosure while courting clients may cause the advisor significant problems.
The Senate Banking Committee on Thursday approved, by a party line vote of 12-10, the nomination of Richard Cordray as director of the Consumer Financial Protection Bureau. The nomination now goes to the full Senate.
Sen. Tim Johnson (left), D-S.D., said in a statement that the banking committee’s vote on Cordray “is an important step forward for American consumers. The Consumer Financial Protection Bureau needs a director, and Mr. Cordray has proven he is qualified for the job. He should be confirmed by the full Senate as soon as possible.”
Unfortunately, Johnson continued, “Senate Republicans are blocking his confirmation, and in doing so they are blocking vital new protections for consumers, and putting community banks and credit unions at a disadvantage to their less-regulated competitors.”
Sen. Richard Shelby, R-Ala., ranking GOP member on the banking committee, said in a statement that the Thursday vote by the committee is “premature.” No nominee for the director of the CFPB, he said, “should receive consideration until the Democrats are ready to stop playing politics and work with us to make the Bureau accountable. It’s their choice.”
Shelby (left) noted that earlier this year, he and 43 of his Senate colleagues sent a letter to President Barack Obama expressing their serious concerns about the CFPB’s lack of accountability. The letter also proposed three “reasonable reforms” to the bureau’s structure, he said. “To date, neither the President nor the majority has made any effort to work with Republicans to improve the accountability of the Bureau. Instead, the President nominated Richard Cordray to be the Bureau’s first Director,” Shelby said.
Senate Banking Committee Republicans stood in unanimous opposition to Cordray’s nomination. Sen. Mike Crapo, R-Idaho, said that he would not support the consideration of any nominee as director of the CFPB “until the structure of the bureau is reformed to enhance consumer protection while ensuring accountability.” The bureau, he said, “is a massive new, expensive government bureaucracy that is immunized against meaningful oversight and dramatically extends the federal government’s control over the economy.”
Sen. Bob Corker, R-Tenn., said that “boards of directors serve an important function, and that’s why regulators, nonprofits, corporations and universities all have them. We are simply asking that this enormously powerful new agency have checks and balances in place that protect the country from an overly-zealous director.”