The consumer bureau’s middle man

Raj Date is a man in the middle.

His official title is special adviser to the secretary of the Treasury on the Consumer Financial Protection Bureau (CFPB), but circumstances have thrust Date into the spotlight as the face of the new agency.

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In that role, he is filling two voids: the one left by the departure of Elizabeth Warren, the former Harvard professor who built the CFPB, and the one created by the stalled nomination of Richard Cordray, President Obama’s pick to be the agency’s director. 

Date jokes that he is stuck between two big pairs of shoes.

“I had made a reasonably good career out of following just a few rules of thumb, and one of those rules of thumb is that you should always compare yourself to a low baseline,” he told The Hill recently at the bureau’s temporary office downtown. 

“Unfortunately, in this role, I’ve been asked to do exactly the opposite. I’m coming after Elizabeth Warren and with Rich Cordray as the nominee.”

Warren is off running for the Senate in Massachusetts, while the nomination of Cordray, a former Ohio attorney general, has run ashore at a GOP blockade. That leaves Date to pick up the slack. 

The bureau, which officially began work in July, is growing rapidly. When Date appeared before the House Financial Services Committee on Nov. 2 to discuss the agency’s development, he said the bureau had hired about 700 employees. Less than two weeks later, he told The Hill that number was closer to 750.

Date joined the bureau back when it existed mostly on paper, serving as one of Warren’s top deputies alongside Cordray. He said the transformation in just over a year has been dramatic. 

“By any rational expectation, indeed, certainly compared to my expectation a year ago, we are somewhere between ahead and dramatically ahead of where I thought we’d be,” he said.

Date has risen to the forefront at the CFPB in large part because of the controversy surrounding it. After Cordray was nominated in July, Senate Republicans announced they would block the appointment until several changes were made to the agency’s structure to add more oversight, which they say is lacking.

Republicans say the leadership structure of the bureau gives far too much power to a single regulator and have proposed replacing it with a multi-member commission. 

“The director has unprecedented power to ban financial products and services based on whether or not he deems them unfair, deceptive or abusive — under really a highly subjective standard,” House Financial Services Chairman Spencer Bachus (R-Ala.) warned in November.

While Date maintains that the fight over the leadership structure is for Congress and the White House to resolve, he supports having a director, saying it provides a “single point of accountability.”

As the CFPB was being built, critics argued it would be the bane of the banking industry’s existence, burdening it with major regulations and excessive scrutiny.

But Date, who came to the bureau after working at banks like Capital One and Deutsche Bank, maintains the industry and the bureau should be on the same page, and says the dire warnings are “quite overblown.”

“I think there a lot of people like me in the industry. People who want the consumer finance business to work for consumers,” he said. “The broader mission of this place is absolutely resonant with sensible business people throughout finance.”

The overarching goal of the agency thus far has been to make consumer financial products easy to understand, so consumers can shop around for the best deal. 

Date maintains that most people recognize the system needs a makeover to do away with the “lawyered-up, hyper-technical mumbo jumbo” often found in financial documents and applications. 

“Outside of the Beltway, I don’t know a single person who says of the pre-Dodd-Frank regulatory apparatus, ‘Yeah, consumer finance regulation in the U.S.? That seemed to work, let’s just keep on doing that.’ Nobody thinks that.”

Since going live, the CFPB has embarked on a number of projects. It is working on simplifying forms for mortgages and student loans, and has begun examining banks for compliance with consumer financial protection laws.

But beyond those projects, Date is dealing with the more intangible work of building an agency culture.

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“We really went out of our way to be very clear from day one about what kind of place we’re building and what is going to be important to us,” he said. “If you’re not wearing a uniform, I would like this to be the best place to serve your country.

“Consumer finance is a gigantic business that has been plagued by gigantic problems. It has got to be made healthier.”

When a director — or a commission, if the GOP has its way — is in place at the bureau, Date says he plans to stick around to help in any way he can. But for the time being, he’s busy trying to prove the skeptics wrong.

“At some point, you have to decide whether or not you’re going to be able to persuade people just through the artfulness of your words, or whether or not you need to get to work and demonstrate the truth of the matter through what you do,” he said. “Since July 21, we’ve been doing that.”