WASHINGTON — The Trump administration has tapped a senior House Financial Services Committee aide to run a relatively obscure agency tasked with monitoring potential threats to the financial system.

If confirmed, Dino Falaschetti would succeed Richard Berner as head of the Office of Financial Research, which was created by the Dodd-Frank Act essentially as a research arm of the Financial Stability Oversight Council. Falaschetti now serves as chief economist for the House panel.

Since Berner’s departure in December, the OFR — which is housed within the Treasury Department — has been run on an acting basis by Ken Phelan, the Treasury’s chief risk officer.

Treasury building
Since former Director Richard Berner’s departure in December, the OFR — which is housed within the Treasury Department — has been run on an acting basis by Ken Phelan, the Treasury’s chief risk officer. Bloomberg News

The White House announcement Monday of the president’s intention to nominate Falaschetti comes amid signs that the administration has attempted to reduce OFR’s independence.

According to internal documents obtained by American Banker earlier this year, the administration has planned significant layoffs at the agency.

President Trump's budget proposal in May called for a reduction of up to 84 full-time workers at OFR and a 25% budget cut, Employees received internal messages about “reduction-in-force” plans. Layoffs are expected to be finalized later this year.

Falaschetti served as a senior economist in President George W. Bush’s Council of Economic Advisors. He is a former fellow at the Mercatus Center at George Mason University and has held faculty positions at the University of California, Berkeley, Florida State University, Montana State University, Seattle University, Stanford University, University of Tennessee, University of Texas at Arlington and Washington University in St. Louis.

Berner unexpectedly resigned in November of last year, which was roughly a year before his six-year term as OFR director would have expired. He is now executive-in-residence at the Center for Global Economy and Business at the NYU Stern School of Business.

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