Richard Cordray, Obama’s Wall Street cop, to leave job by the end of the month

The chief of the Consumer Financial Protection Bureau said Wednesday he’ll step down before the end of this month, marking the departure of yet another Obama-era holdover who’d battled the new administration.

Richard Cordray was the first head of the CFPB, which was the independent watchdog agency set up by the Dodd-Frank legislation to patrol Wall Street in the wake of the 2008 financial collapse.

But the agency was controversial from the start, with Republicans calling it a bureaucracy unleashed, and accusing the CFPB — and Mr. Cordray — of being anti-business.

In his memo to employees, Mr. Cordray said during his tenure the bureau recovered $12 billion in repayments for nearly 30 million consumers, promoted financial literacy and gave average Americans a louder voice in complaining about treatment at the hands of corporations.

He also delivered a pep talk to an agency that is generally out of favor with the Republicans who control Washington.

“The Consumer Bureau is far more than its director. I am confident that you will continue to move forward, nurture this institution we have built together, and maintain its essential value to the American public,” he said.

The Columbus Dispatch reported that Mr. Cordray quit in order to set up a run for governor in Ohio.

Mr. Cordray’s departure will give President Trump the chance to choose new leadership more in line with his approach to business, and the White House said the president will name an interim person to serve while pondering a full nominee for a five-year term.

“The administration will announce an acting director and the president’s choice to replace Mr. Cordray at the appropriate time,” said White House deputy press secretary Raj Shah.

Republicans were not sorry to see Mr. Cordray go.

“We are long overdue for new leadership at the CFPB, a rogue agency that has done more to hurt consumers than help them,” said Rep. Jeb Hensarling, chairman of the House Financial Services Committee.

He blamed the bureau for “extreme overregulation” and said the very structure of the bureau is unconstitutional.

Some conservative allies of the White House have been urging Mr. Trump to fire Mr. Cordray. But during a private bill-signing ceremony last month, the president and some of his advisers expressed concern that firing Mr. Cordray could turn him into a “martyr” for his anticipated bid for governor of Ohio next year.

Mr. Hensarling, who will retire at the end of his term in 2018, has been mentioned as a possible replacement to lead the CFPB.

That would likely not sit well with Senate Minority Leader Charles E. Schumer, New York Democrat, who said Wednesday that Mr. Trump must nominate someone like Mr. Cordray.

“The Trump administration has a troubling pattern of appointing individuals with contempt towards government agencies to run those very departments. They’ve repeatedly assigned foxes to guard the hen house, but I hope they won’t do that with the CFPB,” Mr. Schumer said.

Democrats also praised Mr. Cordray for the work he did nearly six years he was in office.

“Anyone with a bank account, student loan, mortgage, auto loan, or credit score has been helped by his work,” said Rep. Keith Ellison, Minnesota Democrat.

The loss of its leader is just one problem facing the CFPB.

A federal court has also ruled that the board’s structure with a single all-powerful chief whose tenure doesn’t track with presidential terms, and whose finances aren’t subject to congressional oversight, violates the checks and balances the founders had wanted in government.

That ruling is being appealed.

Republicans were so opposed to the CFPB that GOP members in the Senate blocked President Obama’s first choice for a director in Elizabeth Warren, who at the time was a professor and an intellectual godmother of the bureau.

Ms. Warren would go on to win a Senate seat from Massachusetts, and Mr. Obama would use recess powers in 2012 to install Mr. Cordray over the objections of Republicans.

That recess appointment was likely unconstitutional, but the Senate confirmed Mr. Cordray to the post permanently in 2013.

Consumer Bankers Association President and CEO Richard Hunt said policymakers should use Mr. Cordray’s announcement as an opportunity to restructure the agency with a commission, similar to other regulators.

“Congress should use this vacancy as an opportunity to establish a bipartisan, Senate-confirmed commission to uphold the bureau’s important mission of consumer protection for the long-term,” Mr. Hunt said. “A commission will establish transparency and bring a diversity of thought and additional insight to ensure rules are beneficial to consumers and the economy.”

He said nearly 60 percent of battleground state voters, regardless of party affiliation, “prefer a bipartisan commission-based structure at the CFPB – similar to that of nearly every other regulatory body – over a sole director.”