WASHINGTON — Mick Mulvaney's appointment as interim director of the Consumer Financial Protection Bureau was a win for CFPB critics and the administration's conservative base. But the latest names being discussed for the permanent job have something Mulvaney lacks: a background on consumer protection issues.

Jonathan Dever, an Ohio state lawmaker that sources say is in the running, founded a law firm in the state that represents clients facing foreclosure. And another name getting attention of late, Dan Iannicola, helped lead financial literacy efforts as a Treasury Department official in the George W. Bush administration.

Meanwhile, although J. Mark McWatters, the National Credit Union Administration chairman who is also being discussed for the CFPB job, does not appear to have a similar background, observers point out that his NCUA nomination drew Democratic support. That could be key for any CFPB pick in a Senate where Republicans hold a razor-thin majority.

Donald Trump
According to one observer, the Trump "administration has enough credibility” from its conservative base that it can nominate a more moderate director of the CFPB. Bloomberg News

Writing to clients about the Dever rumor last week, Charles Gabriel of Capital Alpha Partners said the Ohio attorney's "focus on helping foreclosed borrowers stay in homes ... may provoke less opposition from Democrats."

“That could be important, but not crucial in the Senate, where Republicans can confirm nominees on a partisan base, with just a simple majority, provided they remain united," Gabriel wrote. "But the threatened loss of even one Republican would force Vice President [Mike] Pence into action to break a tie, and any more defections would spell defeat."

Phillip Swagel, a professor in international economic policy at the University of Maryland and a former assistant secretary for economic policy at Treasury between 2006 and 2009, said signs point to the Trump administration's taking a moderate approach.

Swagel noted that the recent Treasury papers on regulatory reforms propose "substantive" relief for the industry "but did not reject the Dodd-Frank regulatory framework.”

“They certainly didn’t say let’s throw away the bureau," he said.

In contrast to Mulvaney, who has angered Democrats with his moves that appear aimed at blunting the CFPB's role, the names that have recently emerged appear to be less controversial from a consumer protection perspective.

In Ohio, Dever sponsored a bill creating a program allowing homeowners to stay in their homes as renters if they do not qualify for a loan modification. The website for the Dever Law Firm prominently advertises foreclosure defense and loan modification services.

Iannicola, meanwhile, was deputy secretary of financial education in the Bush Treasury. He is now CEO of the Financial Literacy Group, which crafts financial education programs on behalf of clients. The firm's clients include the CFPB, according to the company's website.

Dever and Iannicola's background seem like a departure from the names who were first rumored to be in the running just after President Trump was elected. Former Rep. Randy Neugebauer, R-Texas, a harsh critic of the bureau, was mentioned in the weeks leading up to the inauguration.

Other CFPB critics rumored to be in the running included George Mason University law professor Todd Zywicki and Mark Calabria, who was then at the libertarian Cato Institute. (Calabria has since become Pence's chief economist.)

Even the emergence of McWatters, who has already faced opposition from banks and other critics as a potential CFPB pick, could be a sign of the administration moving to the political middle with the search.

Confirmed to the NCUA in 2014 by a Democratic Congress, McWatters won support from Sen. Elizabeth Warren, D-Mass., the bureau's original architect. The two had worked together on a congressional panel, chaired by Warren, that oversaw the Troubled Asset Relief Program.

"I worked closely with Mark on Tarp oversight and he was always smart, thoughtful, and principled, and I strongly support his nomination," Warren said at a 2014 hearing.

Swagel said conservative critics of the CFPB would likely support whomever Trump nominated for the job, even if that person were more ideologically moderate.

“For the people on the right, Trump has credibility,” Swagel said. “I think the administration has enough credibility” that it can nominate a more moderate director.

He added, “There could be someone more controversial coming.” But he said the administration's other regulatory appointments suggest the nominee will be “conservative but in a pragmatic way.”

“There are people out there who could” meet the conservative qualifications “and would be sympathetic to the bureau and improve it,” Swagel said.

Finding a nominee more palatable to Democrats could help the confirmation process in an increasingly deadlocked Senate, where the GOP has a one-vote majority after Democrat Doug Jones' victory in the Alabama special election.

“Any Trump nominee for the bureau will" face an "arduous and lengthy" confirmation process, said Ed Groshans, an analyst at Height Securities. Groshans said he is still giving a “fair amount of weight” to the possibility that McWatters will be nominated because he could receive less resistance after having already been confirmed to the NCUA.

Scott Astrada, director of federal advocacy at the Center for Responsible Lending, said he believes the administration can find a nominee who “would get bipartisan support and has a history of going to bat for consumers.”

“I am hard-pressed to believe that there isn’t a person that the administration can find” to fit those criteria, he said.

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