Trump’s Bank Watchdog Pick to Get Senate Action, Crapo Says

(Bloomberg) -- U.S. Senate Banking Committee Chairman Mike Crapo said he would seek to quickly schedule a confirmation hearing should President Donald Trump formally nominate a key Wall Street regulator to serve well into the Biden administration.

Crapo said in a Wednesday interview that the White House’s plan to nominate acting Comptroller of the Currency Brian Brooks to a new five-year term “should be given due consideration and I am glad to do that.” Crapo’s stance drew a quick rebuke from Senator Sherrod Brown, the banking panel’s top Democrat, who said Brooks “must be rejected immediately.”

The White House announced its intent to submit Brooks’ name to the Senate for confirmation in a Tuesday statement. The highly unusual move -- coming just weeks before what’s likely the end of Trump’s time in office -- could force President-elect Joe Biden to rely on never-used legal authority to try to remove Brooks and replace him with a more aggressive watchdog.

“President Trump is president until this election is resolved and maybe beyond,” Crapo, an Idaho Republican, said in the interview.

If the White House succeeds in installing Brooks as the permanent head of the Office of the Comptroller of the Currency, it might complicate the Biden administration’s plans to undo some of the Wall Street de-regulation that has been pervasive under Trump. The OCC -- along with the Federal Reserve and the Federal Deposit Insurance Corp. -- is involved in approving most major rules for banks. It also has the most on-the-ground examiners working inside big lenders.

‘Unqualified Appointees’

Brooks is mortgage giant Fannie Mae’s former top lawyer. He also has close ties to Treasury Secretary Steven Mnuchin, having once been vice chairman of OneWest Bank, the lender that Mnuchin made a fortune off of after buying it at the height of the 2008 financial crisis.

“President Trump continues to ignore the results of the election and nominate unqualified financial appointees who will interfere with a new administration’s attempts to save the economy,” Ohio’s Brown said in a statement. “Brian Brooks is not on the side of working people.”

Though the OCC is a division of the Treasury Department, it’s outside of the Treasury secretary’s direct control. Still, the law says a comptroller can be ousted by the president “upon reasons to be communicated by him to the Senate.” While that power hasn’t been tested, it’s a potential avenue for Biden to fire Brooks.

Supreme Court

“The decision whether to keep Brooks as OCC chief will be entirely up to President Biden, and if he decides he wants to fire him, all he needs to do is send his reasons for that decision to the Senate,” said Brianne Gorod, chief counsel for the Constitutional Accountability Center, a Washington legal think tank that advocates a progressive view of the Constitution. Gorod added that the U.S. Supreme Court recently reinforced that presidential authority over the comptroller.

Brooks wouldn’t have much time to be confirmed before the president-elect is sworn in on Jan. 20. Brooks must face a hearing before the Banking Committee and needs to be approved by that panel before his nomination could be considered by the full Senate.

Brooks, who became interim head of the OCC in May, has leveraged experience he gained at San Francisco-based cryptocurrency company Coinbase Inc. and other firms to push a financial technology agenda.

©2020 Bloomberg L.P.