By Vicki Needham - 07/17/11 04:09 PM EDT
President Obama is expected on Monday to nominate former Ohio Attorney General Richard Cordray to head the Consumer Financial Protection Bureau (CFPB).
Obama opted against choosing Elizabeth Warren, the Harvard professor who has been setting up the bureau as a special adviser, but was unpopular with lawmakers.
“I also want to thank Elizabeth Warren not only for her extraordinary work standing up the new agency over the past year, but also for her many years of impassioned leadership, and her fierce defense of a simple idea: ordinary people deserve to be treated fairly and honestly in their financial dealings," he said.
"This agency was Elizabeth’s idea, and through sheer force of will, intelligence, and a bottomless well of energy, she has made, and will continue to make, a profound and positive difference for our country.”
Cordray's selection will be announced at a White House event on Monday.
Warren expressed support for Cordray's nomination.
"Rich has always had my strong support because he is tough and he is smart-and that's exactly the combination this new agency needs,' Warren said in a statement. "He was one of the first senior leaders I recruited for the agency, and his work and commitment have made it clear that he will make a stellar director."
Cordray joined the CFPB in January and heads the new agency's enforcement division. After serving as Ohio attorney general for two years, he lost his reelection bid in November 2010. Warren called him in December to take the job as the bureau's enforcement officer.
Although Obama sidestepped naming Warren, Cordray is still likely to stir up a fight.
Congressional Republicans are pressing for structural changes, including the creation of a five-member commission to oversee the new agency, created under the Dodd-Frank financial overhaul law.
Senate Republicans, including the ranking member on the Senate Banking, Housing and Urban Affairs Committee, renewed promises to block any nominee until changes are made to curb the agency's power, arguing the new bureau is too powerful and lacks accountability.
"Although this deadline has been known for nearly one year, Obama waited until the last possible moment to act," said Sen. Richard Shelby (R-Ala.). "For months he has ignored Republican concerns about the lack of accountability at the CFPB and its potential adverse effect on the economy. Until Obama addresses our concerns by supporting a few reasonable structural changes, we will not confirm anyone to lead it. No accountability, no confirmation."
Cordray became known last year for aggressively investigating big banks with questionable foreclosure practices in his state.
The CFPB officially opens for business on July 21, a year after the agency was created.
In May, House Democrats had urged Obama to use a recess appointment to install Warren as head of CFPB.
They argued that strong opposition from Senate Republicans had forced the president’s hand, but GOP lawmakers said Obama has had ample opportunity to get someone nominated and confirmed.
This story was updated at 2:45 p.m. and 5:30 p.m.