* White House to appeal directly to voters in seven states
* Aim is to pressure Republicans to back Cordray
* Republicans warn of regulatory overreach
By Caren Bohan and Dave Clarke
WASHINGTON, Dec 4 President Barack Obama will
begin a media campaign this week to seek support for his
nomination of banking industry critic Richard Cordray to head a
new U.S. financial watchdog agency.
The White House strategy will be to try to pressure Senate
Republicans to confirm Cordray by making an appeal directly to
voters in the home states of those politicians.
"We intend to aggressively take the case for Mr. Cordray's
confirmation directly to the American people," White House
deputy press secretary Josh Earnest told reporters.
With a Senate vote on Cordray tentatively scheduled for
Thursday, Obama and his aides will give a series of media
interviews on the nomination of the former Ohio attorney
general to head the U.S. Consumer Financial Protection Bureau.
Republicans opposed creation of the consumer agency, which
was created under the 2010 Dodd-Frank legislation overhauling
Wall Street regulation.
Its mission is to protect U.S. consumers from practices
such as abusive mortgage lending and hidden credit card fees.
But Republicans have warned of the risk of regulatory overreach
that could make the U.S. financial industry less competitive.
They have demanded changes before agreeing to confirm
Cordray, who was nominated by Obama in July.
In his former role as attorney general in Ohio, Cordray was
known as a leader among state attorneys general in a probe of
dubious mortgage foreclosure practices. He lost his re-election
bid last year and in December, he worked alongside outspoken
consumer advocate Elizabeth Warren to help set up the new
FOCUS ON SEVEN STATES
The White House will focus its attention on seven states,
including Maine, home to two moderate Republican senators,
Olympia Snowe and Susan Collins, and Tennessee, represented by
Republican Bob Corker, who sits on the Senate Banking Committee
and is up for re-election in 2012.
In addition to Maine and Tennessee, the White House will
also target Alaska, Indiana, Iowa, Nevada and Utah.
Earnest said that administration officials would hammer a
message on the impact on middle-class families of confirming
Cordray and getting the consumer agency fully up and running.
Without a confirmed director in place, there are some
constraints on the consumer agency's regulatory powers. For
example, it is limited in its ability to regulate non-bank
players in the financial system, including so-called "pay-day"
lenders, some mortgage lenders, debt collectors and credit
Earnest said putting in place Obama's selection for the
consumer bureau would help protect Americans who are "being
gouged by hidden fees and other unscrupulous tactics."
Alabama Senator Richard Shelby said in a statement that it
was crucial for the consumer agency and other U.S. financial
regulators to be accountable and pressed his case for changes
to the bureau.
"The CFPB is unaccountable by design. We will continue to
fight for accountability from regulators," added Shelby, who is
the ranking Republican on the Senate Banking Committee.
The Obama administration on Sunday released a report
detailing what it said were regulatory gaps left open by the
lack of oversight of non-bank players in the financial arena.
The White House cited a study that said payday lenders,
which offer short-term loans to help people cover monthly
bills, charge interest rates that can average 400 percent on an
"Our economy and our financial system can't afford a
situation in which consumers are left in the dark about the
risks they take, particularly when dealing with these non-bank
financial institutions," said Brian Deese, deputy director of
the White House National Economic Council.
Warren had been considered the leading candidate for the
consumer bureau job but was considered a lightening rod for
controversy on Wall Street. Obama sidestepped that controversy
by picking Cordray, who shared many of Warren's views but is
not as high-profile.
Cordray is a close ally of Warren, who left the Obama
administration to run for a Senate seat in Massachusetts.