Kathy Kraninger, the new director of the Consumer Financial Protection Bureau, declined Tuesday — her first day in office — to weigh in on the future of a senior agency official under internal investigation over blog posts he wrote years ago expressing controversial views on the n-word and hate crimes.
Democrats and consumer groups have called for Eric Blankenstein, a policy director at the CFPB, to be fired after The Washington Post first reported his comments, which included questioning whether the n-word was inherently racist. The matter is also under investigation by the bureau’s inspector general.
“I have no intention of making personnel decisions on my first day,” said Kraninger, adding that personnel matters are “inherently confidential.”
Kraninger said she was aware of the concerns that had been raised about Blankenstein. But the CFPB has 1,500 employees, Kraninger said. “I am not going to go back and look at everything they have ever written in their lives.”
Blankenstein’s future is one of many challenges Kraninger is expected to face as she launches her five-year tenure as CFPB director. She replaces the bureau’s acting director, Mick Mulvaney, who is also the White House budget chief and Kraninger’s former boss. She spent two years as the associate director of general government programs at the Office of Management and Budget before being nominated by the White House for the CFPB job.
Kraninger, who has little experience in consumer finance, was sworn in by Vice President Pence late Monday and is now one of the country’s most powerful banking regulators.
“I know that beginnings for some are a time of trepidation and that change is not always welcome. Let me assure you that, as a longtime bureaucrat myself, while I am very comfortable with change, I take a little time to understand how and why things are the way they are,” Kraninger said in an email to staff Tuesday morning. “You may not always agree with my decisions, but know that I will seek input.”
Kraninger is expected to continue a business-friendly transformation of the bureau, which has long been criticized by Republicans and the financial industry as being too aggressive. While acting director, Mulvaney scaled back enforcement actions, dropped some lawsuits and moved to reconsider rules criticized by the financial industry.
In a meeting with reporters Tuesday, Kraninger declined to outline what actions she would take first as the agency’s leader but said she is launching a three-month listening tour, including visiting CFPB offices in San Francisco and New York. “We will absolutely put consumers first in the decisions we make,” Kraninger said.
While she didn’t criticize Mulvaney’s leadership of the bureau, Kraninger said things will be different with a full-time, permanent director. “I will be fully accountable for the decisions I make … and they will be mine,” she said.
One potential split could be about the name of the agency. Mulvaney launched a potentially expensive effort to change the bureau’s name to the Bureau of Consumer Financial Protection. The Hill reported this month that the change could cost the companies that the CFPB regulates more than $300 million.
Kraninger said she understood why Mulvaney wanted to make the change but noted that its original title resonates with employees. A decision on the future of the name could be made soon, she said. Some aspects of the name change have been completed, said Kraninger, acknowledging that completing the process had “resource implications.”
“I care more about what the agency does than what it is called,” she said.