By Douglas Gillison
WASHINGTON, July 23 (Reuters) – Capital One executive Brian Johnson, U.S. President Donald Trump’s pick to lead the Consumer Financial Protection Bureau, told lawmakers on Thursday that he would not prejudge whether to pursue pending administration plans to fire most of the agency’s remaining staff.
In confirmation testimony on Capitol Hill, however, Johnson, who served as a top Republican CFPB official during Trump’s first term and currently is in a credit card compliance role for Capital One, avoided directly answering questions from Democratic senators about whether the CFPB should be eliminated, as Trump and the agency’s current director have said publicly.
Russell Vought, Trump’s budget director and acting CFPB director, is due to step down next week after 18 months, during which federal courts blocked efforts to dismantle the agency. During that time, Vought halted virtually all agency activities and sought to fire the vast majority of its staff while dropping a string of pending enforcement actions.
Officials have said that litigation is paused to allow Johnson to consider whether to pursue plans for mass firings.
“I would pledge to you to have an open mind to take a look at staffing levels with the agency,” Johnson said.
However, asked if he could name any of Vought’s policy decisions with which he disagreed, he said, “None come to mind at the moment.” But he suggested that his preference would be for fundamental changes to the agency’s legal structure rather than outright elimination.
“I have testified in the past that properly structured and properly governed, the CFPB is capable of great good,” Johnson said. “However, I think there are deficiencies in the current legislative structure, and I have advocated in the past for changes.”
The Senate Banking Committee, which is considering the nomination, is currently controlled by Republican allies of the president.
Congress created the CFPB following the 2008 financial crash to prevent predatory lending and other misconduct in consumer financial products. Republicans have long attacked the agency as a politicized burden on free enterprise while defenders say it has returned billions to harmed consumers.
Johnson is the third person to be nominated to lead the agency since Trump returned to office last year, though the White House withdrew both prior nominees.
Widely seen as a knowledgeable industry insider, Johnson has in the past also been a vocal critic of the CFPB. David Silberman, a former CFPB official whose tenure overlapped with Johnson’s, said he expected Johnson would not seek to kill the agency.
“I do not think he would pursue an agenda of decapitating the CFPB although I believe he will feel obligated to carry out the president’s directives and policy priorities,” said Silberman.
ETHICS QUESTIONS
Aside from Capital One, ethics documents show Johnson has professional ties from private sector work to companies and former clients that are also regulated by the CFPB, including the major banks operating the money transfer service Zelle.
Enforcement actions involving Capital One and Zelle were among those that Vought dropped.
With his spouse, Johnson declared net assets of between $336,000 and $2.7 million in retirement savings and other investments, according to financial disclosures, as well as salary and bonus payments from Capital One of roughly $740,000. If confirmed, he has agreed to forfeit between a quarter and a half million dollars in unvested Capital One shares.
The bank has waived requirements that Johnson repay some or all of his bonus payments, and as a result he will recuse himself from matters related to Capital One for two years, according to an ethics agreement.
Capital One did not respond to a request for comment on Wednesday.
(Reporting by Douglas Gillison in Washington; Additional reporting by Chris Prentice in New York; Editing by Lincoln Feast and Andrea Ricci )
Comments