U.S. GOVERNMENT PUBLISHING OFFICE

32–318 PDF WASHINGTON : 2018

S. HRG. 115–348 

NOMINATIONS OF KATHLEEN LAURA KRANINGER 

AND KIMBERLY A. REED 

HEARING 

BEFORE THE

COMMITTEE ON 

BANKING, HOUSING, AND URBAN AFFAIRS 

UNITED STATES SENATE 

ONE HUNDRED FIFTEENTH CONGRESS 

SECOND SESSION 

ON 

NOMINATIONS OF: 

KATHLEEN LAURA KRANINGER, OF OHIO, TO BE DIRECTOR, BUREAU OF

CONSUMER FINANCIAL PROTECTION

KIMBERLY A. REED, OF WEST VIRGINIA, TO BE PRESIDENT, EXPORT–IMPORT

BANK

JULY 19, 2018 

Printed for the use of the Committee on Banking, Housing, and Urban Affairs 

( 

Available at: http://www.govinfo.gov/ 

COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS 

MIKE CRAPO, Idaho, Chairman 

RICHARD C. SHELBY, Alabama 

BOB CORKER, Tennessee 

PATRICK J. TOOMEY, Pennsylvania 

DEAN HELLER, Nevada 

TIM SCOTT, South Carolina 

BEN SASSE, Nebraska 

TOM COTTON, Arkansas 

MIKE ROUNDS, South Dakota 

DAVID PERDUE, Georgia 

THOM TILLIS, North Carolina 

JOHN KENNEDY, Louisiana 

JERRY MORAN, Kansas 

SHERROD BROWN, Ohio 

JACK REED, Rhode Island 

ROBERT MENENDEZ, New Jersey 

JON TESTER, Montana 

MARK R. WARNER, Virginia 

ELIZABETH WARREN, Massachusetts 

HEIDI HEITKAMP, North Dakota 

JOE DONNELLY, Indiana 

BRIAN SCHATZ, Hawaii 

CHRIS VAN HOLLEN, Maryland 

CATHERINE CORTEZ MASTO, Nevada 

DOUG JONES, Alabama 

GREGG RICHARD, Staff Director 

MARK POWDEN, Democratic Staff Director 

ELAD ROISMAN, Chief Counsel 

JOE CARAPIET, Senior Counsel 

KRISTINE JOHNSON, Economist 

ELISHA TUKU, Democratic Chief Counsel 

LAURA SWANSON, Democratic Deputy Staff Director 

COREY FRAYER, Democratic Professional Staff Member 

HOMER CARLISLE, Democratic Professional Staff Member 

PHIL RUDD, Democratic Legislative Assistant 

DAWN RATLIFF, Chief Clerk 

CAMERON RICKER, Deputy Clerk 

JAMES GUILIANO, Hearing Clerk 

SHELVIN SIMMONS, IT Director 

JIM CROWELL, Editor 

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C O N T E N T S 

THURSDAY, JULY 19, 2018 

Page 

Opening statement of Chairman Crapo ................................................................. 1 

Prepared statement .......................................................................................... 54 

Opening statements, comments, or prepared statements of: 

Senator Brown .................................................................................................. 3 

NOMINEES 

Kathleen Laura Kraninger, of Ohio, to be Director, Bureau of Consumer 

Financial Protection ............................................................................................. 7 

Prepared statement .......................................................................................... 55 

Biographical sketch of nominee ....................................................................... 57 

Responses to written questions of: 

Senator Brown ........................................................................................... 84 

Senator Rounds ......................................................................................... 107 

Senator Menendez ..................................................................................... 108 

Senator Warren ......................................................................................... 113 

Senator Van Hollen ................................................................................... 118 

Senator Cortez Masto ................................................................................ 121 

Senators Brown and Warren .................................................................... 123 

Senators Brown, Reed, Menendez, Warner, Warren, Schatz, Van Hollen, and Cortez Masto ........................................................................... 130 

Senators Brown, Menendez, Warren, and Cortez Masto ....................... 136 

Kimberly A. Reed, of West Virginia, to be President, Export–Import Bank ...... 9 

Prepared statement .......................................................................................... 63 

Biographical sketch of nominee ....................................................................... 67 

Responses to written questions of: 

Senator Brown ........................................................................................... 144 

ADDITIONAL MATERIAL SUPPLIED FOR THE RECORD

Documents submitted in support of the nomination of Kathleen Laura 

Kraninger .............................................................................................................. 147 

Documents submitted in support of the nomination of Kimberly A. Reed ......... 165 

Letter submitted by Francis Creighton, President and CEO, Consumer Data 

Industry Association ............................................................................................ 178 

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(1) 

NOMINATIONS OF KATHLEEN LAURA 

KRANINGER AND KIMBERLY A. REED 

THURSDAY, JULY 19, 2018 

U.S. SENATE, 

COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS, 

Washington, DC. 

The Committee met at 10:05 a.m., in room SD–538, Dirksen Senate Office Building, Hon. Mike Crapo, Chairman of the Committee, 

presiding. 

OPENING STATEMENT OF CHAIRMAN MIKE CRAPO 

Chairman CRAPO. This hearing will come to order. 

This morning we will consider the nomination of two individuals 

to serve in critical leadership roles within the Administration. I 

welcome both of you, and congratulations on your nominations to 

these important offices. I see friends and family here together with 

you today, and I welcome them as well. 

The nominees before us are Kathy Kraninger, to be the Director 

of the Bureau of Consumer Financial Protection, and Kimberly 

Reed, to be the President of the Export–Import Bank of the United 

States. 

These positions are critically important to protecting consumers 

in the consumer financial products and services marketplace and 

facilitating global trade of U.S. goods and services. These nominees 

bring years of valuable experience at nonprofits and in public service and will provide valued leadership in carrying out the missions 

of their agencies. 

Ms. Kraninger has had a distinguished career in public service 

with exposure to a diverse set of Federal agencies, as well as developing a particular expertise in the budget and appropriations processes. 

Since March 2017, Ms. Kraninger has served as Associate Director for General Government at the Office of Management and 

Budget where she oversees and monitors approximately $250 billion in budgetary resources for numerous Cabinet departments and 

Federal agencies. 

She has also served as OMB’s principal policy official for issues 

related to the Treasury Department, Department of Housing and 

Urban Development, and Federal financial regulators. 

Prior to joining OMB, she held leadership positions at the Department of Transportation and the Department of Homeland Security, as well as serving on the staff of several congressional committees. 

2 

Given her depth and diversity of public service experience, I have 

the utmost confidence that she is well prepared to lead the Bureau 

in enforcing Federal consumer financial laws and protecting consumers in the financial marketplace. 

Ms. Reed was considered by this Committee last year as the 

nominee to serve as the First Vice President of the Export–Import 

Bank, and today we consider her nomination to be its President. 

Ms. Reed also has had a distinguished career in public service, 

previously serving as Senior Advisor to former Treasury Secretaries Paulson and Snow. In addition, she has served on several 

congressional committees and has held impressive leadership positions in the private sector. Ms. Reed is well positioned to help move 

the Bank forward in a positive direction. 

With respect to Ms. Kraninger, some Senators have requested a 

long list of documents, including emails, schedules, involvement in 

memos, White House communications, et cetera, relating to Ms. 

Kraninger’s role at OMB with respect to the Administration’s ‘‘zero 

tolerance policy’’ and the Administration’s response to Hurricane 

Maria in Puerto Rico. 

These requests are designed to go after certain extraneous Administration policies that the requesters do not like and go far beyond the practice of this Committee in document production. Indeed, I would not expect this Administration or any Administration 

to release documents related to its ongoing deliberative process, 

and, furthermore, my understanding is that Ms. Kraninger is not 

the custodian of these records and has given the request for information to the White House. 

As I have indicated, I do not have an expectation that the White 

House or the agencies involved will provide these documents, but 

that is an issue outside this nomination process. 

The Democratic Senators of this Committee asked me to delay 

this hearing today to seek these documents. I am unaware of the 

Banking Committee delaying a hearing for such a reason. 

To be consistent, I have followed a similar timeline as the Committee set for then-nominee Richard Cordray in 2013. As a reminder, the Senate received Mr. Cordray’s official nomination from 

the President on February 13, 2013. Approximately 1 month later, 

on March 12, 2013, the Committee held a hearing to consider Mr. 

Cordray’s nomination and voted the nominee out of Committee 1 

week later on March 19th. 

Similarly, the Senate received Ms. Kraninger’s official nomination from the President on June 20, 2018. Approximately 1 month 

later, we are holding this hearing. She has provided all of the paperwork that the Banking Committee requires. 

The purpose of these hearings is to provide all Senators of this 

Committee the opportunity to ask any questions of this nominee, 

who will be under oath. 

I intend to ask Ms. Kraninger—who will be under oath—about 

her role in developing policy at OMB. Other Senators will be given 

the similar opportunity to question Ms. Kraninger and also follow 

up with questions for the record, as we traditionally do. 

I take the Senate’s constitutional authority seriously and am confident that Ms. Kraninger will be sufficiently vetted, as have our 

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previous nominees, for this Committee to provide a recommendation to the full Senate on this nomination. 

As a separate matter, many of us have experienced frustration 

with the Bureau in previous years. In April 2016, former Bureau 

Director Cordray testified before this Committee. Senators on the 

Committee sent questions for the record that same month. It took 

Director Cordray over 16 months to respond to this Committee. 

It is my hope that, if confirmed, Ms. Kraninger will be more accountable to Senators on this Committee than Director Cordray 

was, and I look forward today to a very vigorous debate and a vote 

on the nominees. 

Senator Brown. 

OPENING STATEMENT OF SENATOR SHERROD BROWN 

Senator BROWN. I thank the Chair. I think the Chairman knows 

that that comparison is specious, but I will get to that in a moment. It was a very simple request that has been out there 4 

weeks, but I want to talk more about that, as I said, in a moment. 

Welcome to the nominees, especially Ms. Kraninger, who brought 

her Ohio family with her. Good to see you all. And Ms. Reed also 

has some Ohio ties. Nice to see you and good to see you both. 

The financial crisis started when greedy lenders lured families 

into scam loans they could not afford. The whole enterprise was designed to transfer wealth upwards—stripping hard-earned home 

equity from the middle class, putting it in the pockets of shady 

lenders, and with that they were successful. And as Members of 

this Committee are familiar with, I see that every day where I live 

in Cleveland. My wife and I live in Zip code 44105, 5 or 6 miles 

from where Ms. Kraninger grew up. My Zip code, 44105, in 2007, 

the first half of that year, had more foreclosures than any Zip code 

in the United States of America. And you know or should know 

what that does to families and to neighborhoods. 

Behind all the numbers were thousands upon thousands of painful conversations around kitchen tables. Congress created the Consumer Financial Protection Bureau to prevent the need for those 

heartbreaking conversations ever again. 

Like food inspectors, the CFPB hunts down scammers trying to 

sneak toxic products back onto our kitchen tables. The Consumer 

Bureau is not just a response to the last crisis. It is one of the most 

important tools we have to prevent the next crisis. 

Though 2008 should have served as a wake-up call for watchdogs 

and CEOs, over the past 6 years, Consumer Bureau inspectors 

have still found plenty rotten in the banking industry. From 2012 to 2017, the CFPB won $12 billion—$1,200 million, 

$12 billion—in relief for 29 million Americans. That is 12 billion 

reasons for Wall Street to hate the CFPB. 

Lucky for them, lucky for Wall Street, they were able to install 

one of their own—Mick Mulvaney—to head the Bureau. He has 

dropped investigations. He has reduced meaningful settlements to 

slaps on the wrist. Now he wants his protege to run the agency. 

For months, I urged the Administration to nominate someone to 

lead the CFPB who had a track record—a track record—of working 

for consumers. Unfortunately, Ms. Kraninger has no experience 

whatsoever in consumer protection. 

4 

Mr. Mulvaney argues she should be approved because of her 

management and budget experience. It is hard to see how that is 

enough, especially given the nominee’s refusal to provide information requested by Committee Members. 

Every one of us on this side of the dais wanted this hearing postponed until we got information about that experience. When the 

nominee and I met, she said it was out of her hands, she would 

try to get a response. That was over a week ago. Still nothing. The 

letter was 4 weeks ago. The response was 1 week ago. What is the 

Administration hiding? 

If my Republican colleagues are concerned about transparency 

and accountability and responsiveness, they should note this nominee’s failure to reply to a simple request about her responsibilities 

in her current job—again, a request that was submitted 4 weeks 

ago. 

Here is what we do know. At the Office of Management and Budget, she signed off on a $1.9 trillion tax break for millionaires. 

To pay for it, she helped write a budget—she called it an ‘‘aspirational document’’ to me—that would triple the rent for families that 

are already struggling to get by. $1.9 trillion in tax cuts, 80 percent 

of those tax cuts over time go to the richest 1 percent, and this Administration, with the approval of the designee to be head of CFPB, 

is willing to triple the rates for families that are already struggling 

to get by. 

She has been involved in the management of one disastrous policy after another. The botched response to hurricanes in Puerto 

Rico has left American citizens—American citizens—to fend for 

themselves. A housing policy that undoubtedly will increase homelessness. The Administration’s cruelest policy yet: separating children from their parents at the border. 

I hope we will know more by the end of the hearing. These issues 

go to the heart of how she will handle any new job. 

Management is supposed to be Ms. Kraninger’s one qualification. 

Nobody wants Mr. Mulvaney out of the CFPB faster than I do. 

But American consumers cannot afford 5 years of someone who 

stands with the bankers in the Administration and stands with the 

bankers on Wall Street. We need a CFPB Director who will sit with 

hardworking families at their kitchen tables. 

I know my Republican colleagues are eager to move this nominee 

in spite of the Administration’s stonewalling. I wish they showed 

a little of this kind of urgency when it comes to the jobs that have 

been put at risk by the failure to have a functional Export–Import 

Bank. 

Ms. Reed has returned for her second appearance before the 

Banking Committee. She is well qualified to lead Eximbank, and 

our Committee voted overwhelmingly to support her nomination as 

First Vice President last December. 

There are 109 export credit agencies and credit programs 

throughout the world that support foreign manufacturers, but the 

U.S. has literally—has unilaterally and literally disarmed. When it 

comes to helping exporters, the policy some of our colleagues seems 

to be ‘‘America Last.’’ 

It has been 4 years since the Senate confirmed an Eximbank 

nominee, leaving Eximbank partially shut down for 3 years. AmerVerDate Nov 24 2008 11:22 Oct 12, 2018 Jkt 046629 PO 00000 Frm 00008 Fmt 6633 Sfmt 6633 L:\HEARINGS 2018\07-19 NOMINATIONS\HEARING\71918.TXT JASON
5 

ican businesses have transactions worth more than $40 billion 

pending at the Bank. Yet there has been stonewalling from this 

Committee and this Republican leadership for years. Those deals 

and the resulting jobs will move overseas unless the Bank’s board 

is restored. 

If President Trump and Republicans are serious about helping 

American manufacturers after 3 years of obstruction—there is no 

other word to describe it—they should urge the Majority Leader to 

schedule consideration of Ms. Reed and the other Eximbank Board 

members immediately. 

In one sense, you brought it up at the end of your opening statement, Mr. Chairman. I want to say one more thing. There is, simply put, no comparison to Rich Cordray in this process. Seven hundred 30 days passed between his nomination and his confirmation, 

July 18, 2011, to July 16, 2013, almost 2 full years. Ms. Kraninger 

was nominated 1 month ago. Two years–1 month comparison. Mr. 

Cordray—look at his qualifications: Ohio Attorney General, Solicitor General, clerked for Supreme Court Justice Kennedy, argued 

in front of the Supreme Court six times, deep experience with consumer rights and civil rights laws. Cordray’s qualifications were 

never under question, but 44 Republicans signed a letter saying 

they would support no one—no one—to head the agency unless we 

changed the law to weaken the agency. Cordray’s first nomination 

died in the Senate. When he was renominated—again, even after 

having a clear track record at CFPB—Republicans continued to oppose his nomination until we defanged the CFPB. You know, that 

is what Wall Street wanted, so like one bird flying off the wire, 

they all fly off the wire, continue to side with Wall Street to defang 

this agency. 

All we ask for with Ms. Kraninger is a response to basic questions regarding Ms. Kraninger’s current job so we can evaluate her 

management skills, which this nomination hangs on. Again, it is 

not her work in consumer protection. It is her management skills. 

Tell us more about those management skills. 

Republicans held up Mr. Cordray for 2 years, demanding changes 

to the law before they would even consider a nomination, so the 

comparison between that process and this, Mr. Chairman, is specious. 

Chairman CRAPO. Thank you, Senator Brown. Since you decided 

to go into that, I will also go into a little further discussion of the 

document request. 

It has been described here today as a ‘‘simple request’’ that goes 

into Ms. Kraninger’s relationship to some of these policies. The fact 

is it is a document request that goes into virtually every conceivable document related to the deliberative process, the budgeting 

process, and the implementation concerning Administration policies 

ranging from immigration to hurricane relief. And now we have 

had the Tax Code thrown in as well. 

Ms. Kraninger is not the custodian of these documents. She has 

forwarded this request to the White House. These document requests are obviously designed to go after various policies of the Administration with which the requesters disagree and go far beyond 

any precedent of this Committee in what it requires of nominees. 

6 

These requests seek to open up extensive document production in 

five agencies: OMB, DOJ, DHS, Treasury, and HUD, including also 

the White House itself. This is a multifaceted battle with the President being played out in the context of this Committee’s nomination process. Indeed, I would not expect this Administration or, 

frankly, any Administration to release these types of documents related to its deliberative process. 

As I said before, Ms. Kraninger has provided all documents and 

information which this Committee requires of nominees, and we 

will get answers from her today on the issues you said we need to 

get information—— 

Senator BROWN. One more thing. We have never really done this 

before, but I am just kind of amazed by this. I am sorry, Mr. Chairman, you have to explain the inexplicable on the part of this 

Trump White House that simply will not step up on this. If there 

is a claim of deliberative process, the White House never has used 

that claim. They have never even responded to the letter, let alone 

any details that she had been willing to share with any of the 

Members with whom she met one on one, including me. She also 

has not been willing, nor has the White House, to give us an answer to the letter, even if the answer is, ‘‘We claim deliberative 

process.’’ 

So I just do not—I hope the Committee is not going to start acting like this, that the White House does not have to answer letters, 

does not have to answer questions from Members of the Senate, 

Mr. Chairman. 

Chairman CRAPO. Well, it is unfortunate to me that the Committee is starting to get into these kinds of battles, too. I am discouraged by that, and I hope that this does not change the tenor 

of cooperation that we have on many other issues. 

I understand the importance of this nomination. I understand 

the long-term battle we have had over the CFPB and its leadership. And the bottom line is I do not know—as I understand, Ms. 

Kraninger has passed this document request on to the White 

House. There are processes by which we can all seek documents 

from agencies and the White House, and I assume you are engaged 

in that process now that she has passed this document on. 

I do not know what their answer is going to be. I will tell you 

what I think their answer will be, but I do not know what it will 

be. That issue is an issue that goes beyond this nomination process. 

That is my point today. 

Senator BROWN. I just think there is no incentive for the—if we 

continue on their merry way, just like all of you on this Committee 

that have spoken with justified outrage, particularly Senator Sasse 

and Senator Corker, with the President’s performance on Monday 

night—or Monday in Moscow—or in Helsinki, but there is never a 

consequence for this Administration because we all continue to do 

the Administration’s—all of you continue to do the Administration’s 

bidding, whether it is confirmation of Ms. Kraninger or whether it 

is confirming another judge or whether it is passing another tax 

cut for rich people in this country. Why should the President 

change his behavior when there is never a price to pay? And one 

price would be let us not do this nomination until they actually 

give us an answer on some of these questions. 

7 

Chairman CRAPO. Well, like I said, I understand the battle that 

you are having with the President on many issues. I do not agree 

with transporting that battle into this nomination process, and so 

today we will proceed. 

Would the witnesses please rise and raise your right hands, 

please? Do you swear or affirm that the testimony that you are 

about to give is the truth, the whole truth, and nothing but the 

truth, so help you God? 

Ms. KRANINGER. I do. 

Ms. REED. I do. 

Chairman CRAPO. And, also, do you agree to appear and testify 

before any duly constituted Committee of the Senate if asked? 

Ms. KRANINGER. I do. 

Ms. REED. I do. 

Chairman CRAPO. Thank you. You may be seated. 

Each of your written statements will be made a part of this 

record in their entirety. Before you begin your statements, as your 

turn comes, I invite you to introduce your family who are here with 

you if you would like to do so. And, Ms. Kraninger, we will start 

with you. You may please proceed. 

TESTIMONY OF KATHLEEN LAURA KRANINGER, OF OHIO, TO 

BE DIRECTOR, BUREAU OF CONSUMER FINANCIAL PROTECTION 

Ms. KRANINGER. Chairman Crapo, Ranking Member Brown, 

Members of the Committee, thank you for the opportunity to appear before you today. It is a privilege to be here as the President’s 

nominee for Director of the Bureau of Consumer Financial Protection. I want to thank President Trump for this honor and for the 

confidence he has placed in me with this nomination. 

I would also like to express my deepest gratitude to my family 

and friends who have joined me today. My parents, Dave and Pat, 

as Senator Brown mentioned, are from Cleveland, Ohio. My older 

brothers, Dave and Dan, and their families traveled from Wisconsin and Connecticut. My younger brother, Matt, and his family 

are watching online. 

I am incredibly lucky to have an amazing family who has encouraged me in every endeavor and who has taught me that with hard 

work and dedication everything is possible in this country of ours. 

I am also especially grateful for their steadfast support as I have 

followed my call to public service and pursued a career serving the 

American people. 

My love for our country, its ideals and promise, drives my commitment to public service. It sparked my interest in my university’s 

summer internship program where I worked for my hometown 

Congressman, Senator Brown. It inspired my decision to join the 

Peace Corps and serve for 2 years overseas teaching in the former 

Soviet Union. There I saw firsthand the devastating impact of communism, the economic consequences of central planning, and the 

absence of free markets and the rule of law. 

Following the attacks on September 11, 2001, I felt the call even 

more deeply, to serve our country in a time of need. I am very 

proud to have served on the leadership teams at both the Departments of Transportation and Homeland Security during that exVerDate Nov 24 2008 11:22 Oct 12, 2018 Jkt 046629 PO 00000 Frm 00011 Fmt 6633 Sfmt 6633 L:\HEARINGS 2018\07-19 NOMINATIONS\HEARING\71918.TXT JASON
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traordinarily challenging time for our Nation. I have also been honored to serve three congressional committees, including the Senate 

Appropriations Committee under Senator Shelby’s leadership. In 

my current position as Associate Director at the Office of Management and Budget, I have taken a broader leadership role, and I 

oversee $250 billion in budgetary resources and related policies for 

7 Cabinet agencies and 30 other Federal agencies, including the 

Bureau, and the other financial regulators. 

Throughout my career I have focused on implementing commonsense solutions to complex problems and delivering real value for 

the American people. While I will not prejudge and cannot predict 

every decision that will come before me as Director, if confirmed, 

I can assure you that I will focus solely on serving the American 

people. 

Congress established the Bureau of Consumer Financial Protection ‘‘to ensure all consumers have access to markets for consumer 

financial products and services . . . that are fair, transparent, and 

competitive.’’ I am firmly committed to fulfilling that congressional 

mandate. To do so, I will establish four initial priorities. 

First, the Bureau should be transparent and fair, ensuring its actions empower consumers to make good choices and provide certainty for marketplace participants. In particular, the Bureau 

should make robust use of cost-benefit analysis, as required by 

Congress, to facilitate competition and provide clear rules of the 

road. In my experience, effective use of notice and comment rulemaking is essential to proper balancing of all interests. It also enables consideration of tailoring to reduce the burden of compliance, 

particularly on consumers and smaller marketplace participants. 

Second, the Bureau should work closely with the other financial 

regulators and the States on supervision and enforcement. Nothing 

is more destructive to competitive markets and consumer choice 

than fraudulent behavior. Under my stewardship, the Bureau will 

take aggressive action against bad actors who break the rules by 

engaging in fraud and other illegal activity. 

Third, the Bureau must recognize its profound duty to the American people to protect the data in its possession. Under my leadership, the Bureau would limit data collection only to what is required under law and is necessary to carry out its mission and ensure that that data is protected. The issue clearly needs more attention because consumers are unaware of the vulnerabilities they 

face and unsure of what steps to take to protect themselves. 

Fourth, the Bureau must be accountable for its actions, including 

its expenditure of resources. 

As a former congressional staffer, I appreciate the important role 

of Congress in overseeing this agency. I value the advice and perspectives you have shared with me in the meetings over the past 

month—conversations that I welcome going forward, should I be 

confirmed in this important position. 

Thank you for your consideration. 

Chairman CRAPO. Thank you. 

Ms. Reed. 

9 

TESTIMONY OF KIMBERLY A. REED, OF WEST VIRGINIA, TO BE 

PRESIDENT, EXPORT–IMPORT BANK 

Ms. REED. Chairman Crapo, Ranking Member Brown, Senators, 

thank you for the opportunity to appear before you today. Thank 

you as well for this Committee’s favorable bipartisan vote to advance my previous nomination to serve as First Vice President of 

the Export–Import Bank of the United States. I now return to you 

as the President’s nominee to serve as President of Eximbank, a 

position that includes serving as Chairman of the Bank’s Board of 

Directors. I thank President Trump for his confidence in me to advance Eximbank’s mission: creating and supporting American jobs 

by facilitating the export of U.S. goods and services. 

If confirmed, I will be both the first woman and the first West 

Virginian to be President and Chairman of this 84-year-old institution. 

I also appreciate the encouragement and support of the President’s National Economic Council Chairman Larry Kudlow and diverse organizations focused on American prosperity. 

I would like to recognize my father, Terry, and sister, Ashley. I 

lost my mother, Janet Logue Reed, an Ohioan, to cancer when I 

was 9 years old, and tomorrow would be her 70th birthday, so I 

send her my love and know that she is with us. 

I thank you for the encouraging and supportive individual meetings to discuss your views and the positive impact Eximbank has 

made for the workers in your States and the potential to do more 

to support them. If confirmed, I will work especially hard to maintain open lines of communication with you and the Congress. 

I am grateful for the support of my home-State Senators, Shelley 

Moore Capito and Joe Manchin. I would bring the grounding of my 

West Virginia upbringing to Eximbank. 

In 1985, Senator Capito’s father, Governor Arch Moore, bestowed 

upon me a golden horseshoe pin for an academic award that I wear 

today. Its inscription reads: ‘‘Montani Semper Liberi’’—‘‘Mountaineers Are Always Free’’. I believe that freedom, in the form of freemarket principles, is the best way to foster economic opportunity 

for all Americans. 

Throughout my 22-year career, I have embraced these principles 

to make a positive difference for our Nation’s businesses and workers while also protecting the American taxpayer. I would bring 

these values to Eximbank. 

Still, there is room for improvement to keep America on this road 

to prosperity, and Eximbank is no exception. If confirmed, I will 

work to ensure that Eximbank faithfully implements all laws and 

reforms enacted by Congress. I would launch a review to ensure 

that Eximbank truly is the ‘‘bank of last resort’’ and not the other 

way around. 

There are now 109 foreign Export Credit Agencies, or ECAs, in 

other countries—up from 95 when I testified before you last November. Eximbank recently reported on ‘‘the increasing 

‘weaponization’ of export trade credit by the world’s ECAs to complement increasingly nationalistic trade policies—particularly those 

initiated by China.’’ If confirmed, I look forward to working with 

the Administration and the Congress on an aggressive response to 

China’s unfair trade policies. 

10 

In a perfect world, there would be no ECA financing. If confirmed, I will work with the U.S. Government and, as appropriate, 

the OECD, G–20, WTO, and other forums to move toward the ultimate goal of eliminating all ECA financing. On that you have my 

pledge. 

Until that goal is reached, the United States should not unilaterally disarm in a fiercely competitive global economy. While we negotiate, we should not place our Nation in a worse position than 

our foreign counterparts. As President Trump stated regarding export financing: ‘‘[W]hen other countries give it, we lose a tremendous amount of business.’’ Therefore, if the Senate confirms a Bank 

Board quorum, I will take responsible steps to get Eximbank operational so America can compete on a more level playing field. 

Eximbank has more than $40 billion in pending applications supporting 250,000 U.S. jobs. We need to keep and support these jobs 

in the United States while we, at the same time, work to reform 

the export subsidies of our competitors to save even more. We can 

do both. 

Eximbank must also treat all American companies fairly, especially small- and medium-enterprises. I would ensure that 

Eximbank—working with community banks and community development financial institutions that I am so familiar with—helps 

small businesses and the agriculture sector, which is vital to rural 

America. 

In closing, I would like to underscore that good governance is 

critical. Eximbank, which has a very low 0.4 percent default rate, 

is self-sustaining because of the fees and loans it charges to the foreign purchasers and has returned $14.6 billion to the U.S. Treasury since the year 2000. We need to ensure that it stays that way. 

Building on my time in the Congress on oversight, investigations, 

and Government reform, I would focus on strong standards of conduct, increased transparency, and sound risk management practices. I would work with you and our Inspector General to ensure 

we are doing all we can to eliminate waste, fraud, and abuse and 

give better value to the taxpayer. 

Thank you for your consideration. I would be pleased to answer 

any questions. 

Chairman Crapo. Thank you, Ms. Reed. 

And I will start my questioning with you, Ms. Kraninger. As was 

obvious in the opening discussions between Senator Brown and myself, there is a desire on the part of some of the Senators on the 

Committee to know what involvement you had, if any, in certain 

policy decisions that have been made by the Administration. Can 

you discuss to what extent, if any, you were involved in the development of the Administration’s zero tolerance policy? 

Ms. KRANINGER. Senator, I appreciate the question. I had no role 

in setting the zero tolerance policy, as I have said to many Members in our meetings. I recognize the reason for the question being 

asked. It is important to note that the Office of Management and 

Budget has an extensive role in supporting agencies as they implement the President’s priorities and agenda. That includes legislative proposals, regulatory proposals, budgetary resources, and those 

kinds of facets of things. So it is clear that since the beginning of 

the Administration, immigration policy, border security policy 

11 

broadly has been a very detailed discussion within the Administration. There have been myriad meetings at all levels of the Administration that I have attended, that the Director and Deputy Director 

and my staff have attended. And in addition to that, Senator, to 

your note, I do believe that the protection and preservation of the 

deliberative process is critical to the ability of the Administration 

to develop policy and implement policy. 

I do not believe it is appropriate, frankly, or fair or right for me 

to articulate the advice that I gave or to characterize the discussion 

that others may have had or brought to the table. But I can assure 

you and all of the Members that in every position that I have ever 

held and every individual I have supported in my career, I have 

given my best advice based on the best information available at the 

time. And that is certainly what I have done in the area of immigration and border security, and I would note again I had no role 

in setting the policy. 

Chairman CRAPO. Thank you. And the same question basically 

with respect to the Administration’s response to Hurricane Maria 

in Puerto Rico. 

Ms. KRANINGER. Senator, with respect to hurricane response, the 

Office of Management and Budget, including myself, as I said, my 

staff, the Director, we have a role in reviewing disaster declaration 

recommendations that go to the President. So we are involved from 

that point. We also put together at the Office of Management and 

Budget the supplemental requests that the Administration puts 

forward to the Hill when they are necessary. 

Obviously, last fall was a devastating hurricane season in the Atlantic that included Puerto Rico being hit by two hurricanes, one 

after the other, with Irma and Maria. So there were devastating 

impacts to that. Clearly, additional resources were needed, and the 

Office of Management and Budget supported the President in putting forward those requests that Congress considered and obviously 

responded to in providing the resources necessary. 

Chairman CRAPO. Well, thank you. 

And, Ms. Reed, U.S. companies are increasingly challenged by 

subsidized export financing from China and other foreign Nations. 

Right now who is picking the winners and losers in the global marketplace? And who, if anyone, should be? 

Ms. REED. Right now, sir, the United States is not picking winners for the United States workers because Ex–Im is not operational. So as I mentioned in my testimony, we have 250,000 jobs 

that potentially could be supported by a reported $40 billion in applications waiting for an Export–Import Bank Board quorum. If I 

am confirmed, I will not pick winners and losers. I will treat all 

applicants equally and fairly. That is what the charter passed by 

the Congress dictates. I will uphold the law. But I also will do all 

I can to help our small businesses in this country. It is very important to me, and I have a long track record on that. 

Chairman CRAPO. And I am sure you are aware that there are 

a number of reforms that many are seeking to see implemented at 

the Eximbank. If you are confirmed, are there reforms you will 

prioritize? 

Ms. REED. Yes, sir. As I outlined in my testimony, I am very 

dedicated to increased transparency. We also have to protect our 

12 

American company applicants from releasing their proprietary confidential business information, but I will take a hard look, if confirmed, at how we can do things to make what Eximbank does 

more transparent. 

I also believe that we need to be focused on good ethics and, if 

confirmed and a quorum is confirmed, we will be standing up a 

Risk Committee and be approving our Chief Ethics Officer and 

Chief Risk Officer. And I also believe we really need to take a hard 

look to ensure that the Bank is the bank of last resort, and so taking a look at some tests that Eximbank currently administers on 

additionality and economic impact, take a look at those again and 

seek input from all the experts. There are many diverse opinions 

on this, and I think it is important as we look at reauthorization 

in 2019 that we take a look at that. 

Chairman CRAPO. Thank you very much. My time has expired. 

Senator Brown. 

Senator BROWN. Thank you, Mr. Chairman. 

A week ago or so, Ms. Kraninger, we had a good discussion in 

our office, and I appreciate your taking the time and the conversation we had. I asked a number of questions about tripling the rent 

for low-income people, about the 600 percent interest that people 

more often than not pay when they get payday loans. The Speaker 

of the House in Ohio resigned, as you probably know, under a scandal about payday loans recently, the first time in our history. 

Your answer to all of those seemed to be that the market will 

take care of this, and I only just suggest to you that I do not think 

that philosophy recognizes how expensive it is to be poor in this 

country. And I would, as I asked you and as I asked Secretary Carson, ask that you spend 3 or 4 hours and read the book ‘‘Evicted’’ 

by Matthew Desmond, because I think it speaks—it really does 

speak in a way that is really important to understand those issues 

better. 

I have a couple of questions. Your response to the Chairman was 

that you did not set policy. I understand that. That is the term that 

you used in my office and in a number of other offices, and it is 

the term you used twice in response to the Chairman. You did not 

set policy. But you do help to execute policy, and would you talk 

about—I am interested in what you did, not what you did not do. 

Talk about executing policy. Talk about what resources you moved 

around on the zero tolerance policy since neither you nor the Administration will even tell us, seem to want to tell us that in response to that letter. 

Ms. KRANINGER. Senator, I appreciate the question. With respect 

to the zero tolerance policy, as noted, again, I will repeat that I did 

not have any role in setting it. When the Attorney General announced it, it was his prerogative to do so, and the Department of 

Justice has repeatedly asserted that they do have the resources to 

support their mission underneath that policy and have done that. 

So the Attorney General has announced publicly—— 

Senator BROWN. Well, I understand. I am sorry to interrupt, but 

we have 5 minutes. I understand what you did not do. Tell me 

what you did do with the zero tolerance policy. 

Ms. KRANINGER. So, similarly, with the Department of Justice articulating it had sufficient resources, the Department of Homeland 

13 

Security and the Health and Human Services Department as well, 

which is not under my purview, but I am aware of some of the 

things they are seeking there, those Secretaries have looked at 

what the resources are available within their flexibilities provided 

through the appropriations process to see what resources may be 

necessary to move around. There were discussions within the Administration on those matters, but it is the prerogative—— 

Senator BROWN. So what did you—I understand the other agencies. I apologize for cutting you off. But what did you actually do 

in your position at OMB on that policy? 

Ms. KRANINGER. So, Senator, there were meetings after the announcement of the policy as the Secretaries raised questions about 

it and were looking at their own resources to try to figure out how 

to support that implementation. And, again, the Office of Management and Budget is there to support those agencies, to ask questions, and, again, in terms of the advice and details, it would be 

chilling to the deliberative process to give you extensive details on 

the substance of the discussion. I appreciate why you are asking. 

At the same time I do not think that is appropriate to get into the 

particular details of my advice. But I can say generally that the Office of Management and Budget supports those agencies in analyzing the need and looking at the appropriations law and the 

needs that are made known to us. 

Senator BROWN. This is sort of the same nonanswer to the letter. 

When we met last week, I asked you to name some enforcement 

actions that Director Cordray had taken that you support. You did 

not come up with any answers then. Do you have any now as you 

have had a little time to think about it? 

Ms. KRANINGER. Senator, it was a good conversation in your office. I appreciate you alluding to it as well, and I would say on that 

point specifically, as I noted in my statement, I do support the Bureau exercising its authority to take enforcement matters when bad 

actors are operating in the system. No one—— 

Senator BROWN. Can you come up with an example—I am sorry 

to interrupt—— 

Ms. KRANINGER. Sorry, Senator. Specifically—specifically two 

areas that—the investigations that were launched under Director 

Cordray’s leadership and that were continued under the current 

Administration, I can note Equifax certainly. A lot of Members, we 

discussed extensively concerns about credit reporting agencies and 

their practices. The Equifax fallout is going to be something that 

is going to be with us for a long time as a Nation and an issue that 

I know many are grappling with. And if confirmed, I would be 

grappling with the steps that need to be taken there. So that was 

certainly something launched under his leadership. 

And I would say, too, the Wells Fargo enforcement actions as 

well. That is an area that, again, completely inappropriate—— 

Senator BROWN. Even though my colleagues here said that CFPB 

did not do its job, but one last question. One of the enforcement 

actions that Director Cordray took was against a company 

scamming 9/11 first responders. The judge in the 9/11 first responder case struck down CFPB’s claims, agreeing with the President’s Supreme Court that the Bureau is unconstitutional. Would 

you challenge that ruling inside of the CFPB? 

14 

Ms. KRANINGER. Senator—— 

Senator BROWN. So, in other words, are you going to take the 

side—I am sorry again. Are you going to take the side of the 9/11 

scammers, or are you going to take the side of those who were 

scammed as you decide what to do on this court case? 

Chairman CRAPO. And please make your response prompt. 

Ms. KRANINGER. Absolutely. I am aware of the constitutionality 

questions, Senator. I think they are important, but they are not for 

me in this position to answer. The Director has a responsibility to 

carry out the law as it is written and run the agency as it is established now, and that is my focus. 

Senator BROWN. Thank you. 

Chairman CRAPO. Senator Corker. 

Senator CORKER. Thank you, Mr. Chairman. And I thank both of 

you for your willingness to serve. 

I do want to respond to Ranking Member Brown with sincere 

warmth. We came in together, and I have enjoyed serving with 

you. It seems to me that what has been happening is if we do not 

like something the President does—and I will take a back seat to 

no one in challenging foreign policy issues, tariff issues, with every 

ounce of energy that I have. But if we do not like some of the 

things the President is doing, we should then block nominees that 

we like. 

I got a call after the Helsinki press conference, which to me was 

one of the worst I have seen, from a leading Democrat—I have 

shared this with some of my friends—and he said, ‘‘Corker, you 

need to block the Supreme Court nominee.’’ Well, I could hit myself 

in the knee with a sledgehammer, too, but why would I block someone that I generally like over something that the President has 

done? 

And I just want to say that, again, I take a back seat to no one. 

Senator Menendez and I had a conversation about this yesterday. 

But it is actually you that is doing the President’s bidding on tariffs. Senator Toomey and I tried to block this terrible policy that 

is costing Americans jobs, taxing Americans—taxing Americans— 

and you are actually doing his bidding. So I could throw that right 

back. 

And what I would like to see happen is if we could somehow 

depoliticize this Bureau—I mean, it started out in a way that was 

controversial under Dodd–Frank. It was the thing that kept us 

from having a bipartisan bill in Dodd–Frank. It was this agency 

that kept us from having a bill that would have stood the test of 

time. I think we could have come to an agreement if it were not 

for the way that this was set up, without a board and dividing all 

of us. 

So I would like to see us somehow figure out a way for this agency to go forward. There are abuses that happen. There are abuses 

that happen, and the Bureau has done some really good things in 

that regard. It has also, in some cases it feels, done some things 

that were somewhat political. Somewhat. I had a good relationship 

with Cordray. I enjoyed working with him. 

So I would like to ask our nominee, what is it that you can do 

leading the Department to try to cause this whole political atmosphere around it to diminish as its leader so that we do not have 

15 

these types of processes every time anything comes up regarding 

this Bureau? 

Ms. KRANINGER. Thank you, Senator, for that question, because 

it is obviously critical and central to the discussion that is happening here today and has been happening for years on the Bureau. 

What I bring to this position and why I was selected by the 

President for this position is precisely that: 20 years of Government 

service, working for common-sense solutions across the aisle, working with Members on both sides to support the best outcome for the 

American people. And that is certainly what I pledge. This agency 

clearly needs solid management to take it forward, to become part 

of the financial regulatory framework of this Nation as a mature 

regulator, and that is the direction that I would like to take it, if 

confirmed. And I firmly believe that we can continue to push for 

transparency and accountability at the Bureau, again, to really 

have a clear decision-making process that takes into account all of 

the interests that are across the Nation, from consumer groups to 

the financial institutions to all of you here today, to make the best 

decisions and put forward the best actions for the American people. 

Senator CORKER. So I am Chairman of the Foreign Relations 

Committee, and there are people on our staff that are just outstanding, finest people I have ever worked with in my life. And 

they are specialists in what they do, and I call upon them to help 

me in doing what I am doing. 

It is my understanding that you have people like that already at 

the Bureau who would be working underneath you, if confirmed, 

and one of the challenges that people have put to you is that you 

have not been in this area. But it is my understanding that you 

have some very capable people that work underneath that are specialists in the areas that the Bureau would be dealing with. Is that 

correct? 

Ms. KRANINGER. Yes, Senator, it is. I very much look forward to 

meeting all of them, understanding the details of the positions that 

they have taken, the recommendations that they have made, and 

moving the Bureau forward. 

Senator CORKER [presiding]. And if you would, state—I know I 

have got 3 seconds left. Let me say to Ms. Reed, I enjoyed seeing 

you in Uganda. I appreciate the meeting that we had in our office. 

I know that Senator Toomey and others have focused on some reforms that they would like to see take place. Many of us for years 

have hoped that the Department itself would reform. I hope that 

we will be able to work with you and others to make that happen, 

and I thank you both for your willingness to serve. 

With that, I am the stand-in Chairman, and I call on Senator 

Menendez. 

Senator MENENDEZ. Thank you, Mr. Chairman. 

Ms. Kraninger, you have been nominated to lead the agency that 

is singularly tasked with protecting American consumers from 

predatory financial practices, from seniors to servicemembers, students to homeowners. We created the Consumer Financial Protection Bureau to be an independent cop on the beat for American 

consumers. 

16 

When we met—and I appreciate you coming by—you told me 

that your management experience at OMB has prepared you for 

this role. So I want to ask you about that, specifically about the 

Administration’s response to Puerto Rico. Hurricane Maria tragically killed thousands of people, resulted in the longest blackout 

in U.S. history, and left Puerto Ricans without access to clean 

water for weeks. It took FEMA only 2 weeks to send Texas almost 

three times the amount of staff that it sent to Puerto Rico more 

than 2 months later. 

Now, I sent you a letter asking for information about your role 

in Puerto Rico, and I asked for a response by this past Monday. 

You failed to provide one. 

As it turns out, I have emails that demonstrate your involvement 

in the Trump administration’s response to Hurricane Maria, although these are not emails that you provided to us. In my office 

you told me that not only were you involved in the response to 

Puerto Rico through your oversight of FEMA, Treasury, and HUD, 

but that you oversaw the development of disaster aid requests to 

Congress. 

So let me ask you here, and please provide me some brief responses because I think factually we probably both know the answers. In the first aid package that Congress passed after Hurricane Maria, most of Puerto Rico’s aid came in the form of a community disaster loan that can only be forgiven at the discretion of the 

Secretaries of Treasury and Homeland Security, an unprecedented 

condition not applicable to Texas or Florida. 

Is it true that Puerto Rico had to wait 5 months to receive this 

funding? Yes or no? 

Ms. KRANINGER. Not exactly, Senator. The CDL loan was actually an unprecedented amount of resources being provided that 

Congress deemed appropriate, making—— 

Senator MENENDEZ. Did they wait 5 months to get the money? 

Ms. KRANINGER. ——available $1.5 billion—— 

Senator MENENDEZ. Did they wait 5 months to get the money? 

Ms. KRANINGER. No, Senator, I actually do not believe that the 

Governor has availed himself of this option yet. At the same time, 

it is an unprecedented amount of money that is available for 

that—— 

Senator MENENDEZ. Well, let me tell you what happened since 

you seem to have a different recollection. The Administration 

unjustifiably withheld the loan from Puerto Rico, arguing that it 

had a cash balance at the end of 2017 and, therefore, did not need 

the money. I am sure there were cash balances in Texas and Florida. 

In November of 2017, Puerto Rico Governor Rossello requested $94 billion in recovery funds. In response to this request, how 

much money did you request from Congress? 

Ms. KRANINGER. Senator, the request the Administration submitted actually included an addendum to the letter that said specifically additional funds would be requested. 

Senator MENENDEZ. Can you give me the dollar figure? 

Ms. KRANINGER. Senator, it was a specific amount for the Disaster Relief Fund that actually applies to all the disasters, not 

just—— 

17 

Senator MENENDEZ. And that amount was $44 billion—— 

Ms. KRANINGER. ——Texas, Florida, and Puerto Rico. 

Senator MENENDEZ. ——was it not? 

Ms. KRANINGER. Yes, I believe that is correct. I do not have—— 

Senator MENENDEZ. And that was to be split among Texas, Florida, Puerto Rico, and the U.S. Virgin Islands. Is that correct? 

Ms. KRANINGER. Yes, Senator. It was also the third request, and 

the note was made that there would be an additional—— 

Senator MENENDEZ. In November 2017’s request to Congress, 

you requested budget cuts to offset aid dollars provided to Puerto 

Rico. In your extensive disaster management experience, does Congress typically require offsets for supplemental disaster funding? 

Ms. KRANINGER. I am sorry, Senator. Does the Congress normally—— 

Senator MENENDEZ. Typically require offsets for supplemental 

disaster funding. 

Ms. KRANINGER. Senator, my role specifically at OMB is certainly 

to make recommendations. These are the requests that the President is making supported by the Office of Management and Budget. 

Senator MENENDEZ. Is the answer yes or no? Does Congress typically require offsets for supplemental disaster funding? 

Ms. KRANINGER. It has been a common—— 

Senator MENENDEZ. You and I both know the answer is no. 

Ms. KRANINGER. It has been a common conversation in recent 

years, definitely, but again, it is the prerogative of Congress—— 

Senator MENENDEZ. It is not a common conversation. The answer 

is no. You should know that. You know that. 

Ms. KRANINGER. It is a conversation that has been had, Senator, 

and I appreciate your perspective on it. 

Senator MENENDEZ. Did you—amazing. Did you advocate for unprecedented policies that would have conditioned Puerto Rico’s receipt of disaster relief funding on the oversight of the island’s 

unelected and unaccountable control board? 

Ms. KRANINGER. Senator, as I noted earlier in other discussions, 

I do not think it is appropriate to characterize my advice. You do 

see what the request was that the Administration provided to the 

Congress and that Congress considered and that Congress—— 

Senator MENENDEZ. In your emails you actually say that you see 

a role for the board. Look, you were a significant architect of the 

Trump administration’s response in Puerto Rico, which was, at 

best, botched and incompetent. At worst, it reflects the Administration’s most insidious views about Hispanic Americans. Three-anda-half million American citizens who just happen to call Puerto 

Rico their home, but they are American citizens like you and I are, 

faced their darkest hour, and instead of turning to help them, you 

pinched pennies. And worst of all, I think you treated them like 

second-class citizens. That does not give me the faith that when 

you are going to have to stand up for seniors, servicemembers, students, homeowners against some of the biggest financial institutions in this country that you will do that. If you could not do it 

for the people of Puerto Rico, I do not know how you are going to 

do it for anybody else. And they are U.S. citizens, Ms. Kraninger. 

Senator CORKER. Thank you. 

18 

Senator Toomey. 

Senator TOOMEY. Thank you, Mr. Acting Chairman, and I want 

to thank our two guests today for their willingness to serve. 

Let me start with Ms. Reed. Thanks for coming by my office. I 

appreciated the conversation that we had. And I think it is no secret that I have been very concerned and a skeptic about 

Eximbank, a skeptic about its fundamental mission. In my view, it 

is by its nature intrinsically forced to subsidize—it forces taxpayers 

to subsidize certain companies. It distorts markets. It necessarily 

picks winners and losers by virtual of its very activity. There have 

been episodes of waste and fraud and abuse. Historically it has not 

been particularly responsive to Congress. And despite all that, I 

was willing to vote to confirm a quorum of board members, provided that a reformer like Scott Garrett be leading this organization. Our pro-Eximbank Senators preferred not to have a quorum, 

and so that is where we are. 

However, consistent with my interest in seeing reforms, I was 

pleased with your testimony. You emphasized a number of areas 

where you have committed to us that you want to pursue reforms, 

but I would like to just have a specific series of questions that I 

would pose to you and just give me a simple answer as to whether 

or not these are areas that you would work with us for reform. 

So, specifically, will you work with me and other Members of this 

Committee and the Senate to increase transparency at the Bank to 

the greatest extent that is practicable without divulging confidential business information? 

Ms. REED. Yes, sir. 

Senator TOOMEY. Will you work with me and the Committee to 

strengthen taxpayer protections against losses from deals that go 

badly? 

Ms. REED. Yes, sir. 

Senator TOOMEY. Will you work with me and Members of the 

Committee to improve protection for domestic companies from economic harm that might arise from Eximbank financings with foreign competitors? 

Ms. REED. Yes, sir. 

Senator TOOMEY. Will you work with us to ensure that 

Eximbank is not crowding out private financing options that would 

otherwise be available but for Eximbank’s involvement? 

Ms. REED. Yes, sir. 

Senator TOOMEY. And will you work with me and the Committee 

to crack down on bad actors, whether they are employees of the 

Bank or its customers who should not be dealing with the Bank? 

Ms. REED. Yes, sir. 

Senator TOOMEY. And will you work with all of us and the Administration to meet the statutory requirement that we work to reduce the reliance on ECAs globally? 

Ms. REED. Absolutely. 

Senator TOOMEY. Great. Thank you very much. 

Ms. REED. Thank you. 

Senator TOOMEY. Ms. Kraninger, two things. One, under the previous regime, the CFPB occasionally engaged in imposing policies 

that had the effect of being a rule without going through the Administrative Procedures Act. They decided to use enforcement and 

19 

guidance to impose their will without following the legal requirement that they subject such a proposal to the scrutiny that is 

called for in the APA. There is one case, in fact, where it was so 

egregious that the Senate acted to repeal the rule. The indirect 

auto lending was exactly such a case where a guidance was the 

mechanism they used to impose what should have gone through 

the rulemaking process. Never did. The Congress recognized that 

and has since repealed it. 

My question for you: Will you commit to using the Administrative Procedures Act when the CFPB imposes new rules? 

Ms. KRANINGER. Absolutely yes, Senator. It is critical to the process. 

Senator TOOMEY. Thank you. 

Section 1071 of the Dodd–Frank Act unfortunately instructs the 

Bureau to collect and compile data on small business lending. I say 

‘‘unfortunately’’ for a number of reasons, not the least of which is 

this is meant to be a consumer bureau, not a business bureau. But, 

nevertheless, the law says what it says, and I understand you have 

to comply with the law. 

My understanding is that Section 104 of S. 2155, which was recently passed and signed into law, addresses the challenge of overly 

intrusive data collection with respect to small mortgage lending. So 

there is some relief built in there. But it is narrow. It is narrow. 

It applies only to the small mortgage lenders. 

My understanding is that Section 1071 of Dodd–Frank does allow 

the Bureau to make exceptions to small business data collection. So 

my question for you is: In implementing and complying with this 

part of Dodd–Frank, this requirement, will you commit to working 

to minimize the undue cost burden, administrative aggravation for 

small business compliance with this part of the law? 

Ms. KRANINGER. Senator, I can absolutely commit to you that the 

law will be carried out, and the authority given to the Bureau to 

tailor that narrowly is certainly something that I will look at, and 

I can pledge to you I will. This is an ongoing action that the Bureau is looking at, and it is an area, to your point, the law requires 

the Bureau to act. So I do not want to prejudge it. At the same 

time, I appreciate where you are coming from, and I understand 

the need to limit—— 

Senator TOOMEY. And just very briefly, because I know I am out 

of time, but can you confirm, do you agree with my interpretation 

that 1071 is the only respect in which Dodd–Frank mandates the 

Bureau to deal with small business? 

Ms. KRANINGER. Senator, it is very clearly one, and I have not 

read all of the enumerated consumer laws. As you know, there are 

many. At the same time, I absolutely believe that there is a limited 

intent for the Bureau to be engaged in small business oversight or 

engagement there. So that is something that should be limited. 

Senator TOOMEY. Thanks, Mr. Chairman. 

Senator CORKER. Thank you, Senator Toomey. 

Senator Tester. 

Senator TESTER. Thank you, Senator Corker. I appreciate the 

recognition. Thank you, both of you, for being here today. 

20 

I am going to start out with you, Ms. Kraninger. It is no secret 

that Mr. Mulvaney is no fan of the CFPB. That aside, would you 

say that he has done a good job in his role as Acting Director? 

Ms. KRANINGER. Senator, I would say that the Acting Director 

has focused on two priorities: one—— 

Senator TESTER. No, no, no, no, no. Just, please, I know how to 

filibuster, you know how to filibuster. Just answer the question. 

Ms. KRANINGER. I understand. 

Senator TESTER. Has he done a good job? 

Ms. KRANINGER. Senator, he is my current boss who I respect 

greatly, and he has actually been focused on implementing the law. 

From that standpoint, I would say yes. 

Senator TESTER. OK. So one of the things you had in your four 

points that you were going to bring to the CFPB, I want to focus 

on the second one: work closely with other regulators and aggressively take actions against bad actors. I think that is a noble thing 

to do. 

Mr. Mulvaney has pulled back the payday lending rule. He has 

eliminated the Office of Students and Young Consumers. He has 

pulled back the prepaid accounts rule. And he has done more 

things than, quite frankly, I have got fingers. OK? Did you support 

him in those then? Do you think those are the right actions to 

take? Because it goes, in my opinion, contrary to your number two 

plank of what you are bringing to the agency. 

Ms. KRANINGER. I understand your interest. I will attempt not to 

filibuster, Senator. I have to say that I will take aggressive action, 

if I am confirmed, and I do believe that the Acting Director, you 

know, has information that I do not have available—— 

Senator TESTER. Do you plan on reinstating, for instance, the 

payday lending rule? 

Ms. KRANINGER. Senator, it is under active consideration, and 

from that vantage point, it is not—— 

Senator TESTER. OK. Are you going to recommend that they reinstate the payday lending rule? 

Ms. KRANINGER. I think it is important to let the process happen 

on this, because it is actively under reconsideration, and so it is not 

appropriate to comment. I understand your interest in it, sir. 

Senator TESTER. So, look, you have probably got the votes to get 

confirmed, but I have got to tell you that I have listened to the 

questions that have been asked here today, and you can answer the 

questions. You really can. All you have got to do is answer them. 

You are going to be the head of this agency. You are going to be 

leading this agency. Your recommendations are going to count for 

something. And so it would be really helpful for me to know, if I 

am going to vote for you or not vote for you, where you are at— 

where you are at, not the people under you. 

OK. Let me ask you another one. One of the other things that 

Mulvaney did is he appointed political folks to track career folks 

within the agency, the same folks that you said that you are going 

to be looking forward to working with. Do you intend to keep those 

political folks on board within the agency if and when you become 

Director of the CFPB? 

Ms. KRANINGER. Senator, I am going to take every staff member 

individually and have a conversation with them to understand 

21 

what they have been working on and what they would like to continue to work on. But I have not prejudged having political or career staff continue. I think it is appropriate to give them that opportunity to have the conversation. 

Senator TESTER. OK. So you oversaw the Treasury Department 

in your position at OMB, correct, as one of the seven agencies that 

you oversaw? 

Ms. KRANINGER. Yes, Senator. 

Senator TESTER. OK. Earlier this week, the Treasury Department and the IRS announced that—it was one of the swampiest decisions that I, quite frankly, have ever seen. They have made a decision to allow for these (c)(4)s not to have to report money that 

they have received, nonprofits, allowing donations to those (c)(4)s 

over $5,000 not have to be reported to the IRS. Do you agree with 

that decision? 

Ms. KRANINGER. Senator, I understand that they published that 

decision. I can tell you I did not have a role in it. 

Senator TESTER. I know, but do you agree with that decision? 

Whether you had a role or not, do you agree with that decision? 

Ms. KRANINGER. Since I have not read the law in that area and 

gotten into detail—— 

Senator TESTER. So it is going to allow these organizations not— 

to basically hide where they got their money. Is that OK? 

Ms. KRANINGER. Senator, I think they looked at the law and the 

requirements and came forward with the policy decision. 

Senator TESTER. OK. So let me ask you this: The number one 

thing that you are going to bring to the Bureau is transparency 

and accountability. Can you tell me how that decision, just sitting 

on the outside looking in, whether you have oversight of that agency or not, the Treasury Department, how you could actually say, 

‘‘You know, I do not have an opinion on it,’’ when it deals exclusively with transparency? 

Ms. KRANINGER. And, Senator, I can tell you at the Bureau that 

I am committed to that. 

Senator TESTER. So let me ask—I am not even going to ask. I am 

just going to make a statement. I liked your document that you 

gave us that was your opening statement. It said a lot of good 

things that I agree with: protecting data, we could get into Equifax, 

I am not sure we would get any answers. Accountability for actions, I like that. Transparency, working closely, holding bad actors—but, by the way, your answers did not reflect those values at 

all. 

Thank you, Mr. Chairman. 

Chairman CRAPO [presiding]. Senator Tillis. 

Senator TILLIS. Well, welcome. Before I get into some of the 

questions primarily toward Ms. Kraninger, Ms. Reed, I want to 

talk a little bit about what we—thanks to both of you for coming 

to the office, but I want to talk a little bit about why I believe the 

Eximbank needs to become functioning again. I think that you in 

your opening testimony talked about an increased number of equivalent agencies in the global markets. 

I for one think that we have got to get away from this either/ 

or proposition with Eximbank and start talking about the reality 

that if we do not have this in our toolkit, when we are competing 

22 

in the global markets, that we disable ourselves much the same 

way a State would get out of economic incentives. Do you agree 

with that? 

Ms. REED. Yes, sir. 

Senator TILLIS. Do you also agree that there may be things that 

could make the Eximbank less politicized if we worked on improving that but for the involvement of the Ex–Im Bank, the transaction would not necessarily go the positive way? And can I get 

your commitment to come back either to my office or before this 

Committee to tell us what that would look like so that hopefully 

we can get to a better place and better certainty for the long-term 

interest of the Eximbank? 

Ms. REED. Absolutely. 

Senator TILLIS. Thank you. Thank you for your service. I look 

forward to supporting your nomination. 

Ms. Kraninger, there are a lot of people that asked a lot of questions and gave you a limited amount of time to answer. Are there 

any things that you would like to respond to here before I ask you 

a couple of questions? 

Ms. KRANINGER. Thank you, Senator, for that opportunity. I recognize that Senator Tester wanted to hear a little bit more about 

my views. I can certainly talk about the challenges with the payday 

lending arena. 

I do take the point of the conversation that I have had with Senator Brown on the challenges for hardworking Americans out there, 

and I think what would be helpful is continued competition in the 

small dollar lending space. So I would say that Comptroller 

Otting’s action in trying to work with traditional banks to bring additional products and services to the market is something that 

would be useful. But I certainly—it is a difficult position to be in 

because it is on the regulatory docket for the agency. I know that. 

And it is something that cannot be prejudged, and so I respect the 

process there. But I certainly have spent some time looking at this 

issue and look forward to further getting into it. 

Senator TILLIS. I think in the opening testimony the Ranking 

Member talked about folks on our side of the aisle who have been 

working hard to defang the CFPB, and I am one of those because 

I think if you look up ‘‘defang’’ in the dictionary, it has something 

to do with taking the fangs out of a snake to make it less poisonous 

or less threatening. And in my opinion, the CFPB has a great 

title—Consumer Financial Protection Bureau, or the new title 

now—but the reality is I think that it is the first agency of its kind 

that is not accountable, arguably, to anybody, because after you get 

confirmed, for a period of time, just like your predecessor, you do 

not even really answer to the President. You certainly do not answer to the Congress. 

When Mick Mulvaney, Director Mulvaney, was here, I was 

struck by his goal of trying to convince us that they should be an 

agency that is more accountable to the President. Do you or do you 

not share Director Mulvaney’s view that this is an agency that is 

sort of unlike anyone with great power and not accountability and 

that that is not good for any area of Government? 

Ms. KRANINGER. Clearly, Senator, the Congress through the 

Dodd–Frank Act gave the Bureau incredible powers and incredible 

23 

independence from both the President and the Congress in its 

structure. I have noted that my focus is on running the agency as 

Congress established it, but certainly working with Members of 

Congress, I am very open to changes in that structure that will 

make the agency more accountable and more transparent. 

Senator TILLIS. Well, for those who are not going to support your 

nomination, I for one think that this is a great time for us to come 

together and actually move that accountability and funding back 

into Congress so that they could actually have some say, because 

the fact of the matter is you, like Mick Mulvaney, do not really 

have to care—but for maybe your interest in democracy and respect 

for Congress, you do not have to care one bit about our opinions 

about your activities. And unless we get to a point where it is accountable, becomes accountable to Congress, that is going to continue. And I for one hope that you go out there and you work on 

clawing back regulations that on the surface look like they are 

passed for protection of the consumer, but in many cases they are 

harmful ultimately to the consumer, either in terms of cost or access to capital. 

I look forward to supporting your nomination. I also welcome 

your family and friends here. The nominees are going just fine, and 

I look forward to supporting both of you on the floor. 

Chairman CRAPO. Senator Warner. 

Senator WARNER. Thank you, Mr. Chairman. And I want to say 

welcome to the witnesses. Ms. Reed, I look forward to supporting 

you. You are a lucky witness this morning since your colleague is 

receiving most of the attention. 

I am sorry Senator Corker is no longer here. I was here at the 

start of Dodd–Frank and CFPB. Senator Corker and I worked very, 

very closely together. If my memory serves, the original proposals 

around CFPB were to set it up as more of a traditional agency with 

traditional oversight. But it was then some Members of the minority’s position that they did not want to create a new box, a new entity, so it was put in this, I agree, rather unique framework inside 

the Fed with that certain funding stream. But I think the history 

would demonstrate that that was how the rather unique aspects of 

the CFPB came to be. 

Ms. Kraninger, I want to drill down in a couple specific areas. 

I think in every aspect of the CFPB work, it needs to make sure 

that you use data to analyze problems and really make data-driven 

decisions rather than agenda-driven decisions. Senator Warren and 

I submitted a comment to the CFPB expressing our deep concern 

about Director Mulvaney’s skepticism of data collection by the 

CFPB, and I think he has expressed an ongoing hostility toward 

data collection and the use of data. As an example, he froze collection of personal data for nearly 6 months, got rid of a planned survey on debt collection disclosures. And I am deeply concerned that 

one of your four priorities was to limit data collection to what is 

‘‘needed and required by law.’’ And I know as well—and I have 

been somebody who has favored cost-benefit analysis, but how do 

you do a cost-benefit analysis that is going to be accurate and adhere to fact-based if you are not able to do appropriate data collection to influence your decision? How can we be assured that it is 

24 

then not going to be a political-driven agenda rather than a databased agenda? 

Ms. KRANINGER. Senator, I appreciate the question. I am absolutely committed to data-driven decision making, and should I be 

confirmed, that would be a focal point at the Bureau. I take your 

point, but I think again, to the extent that it is supporting that decision making, the data collection would be needed and required. 

I also think it is important to distinguish here between the data 

that comes through the requests for information that are out to the 

public. There are a number of sources of evidence that come beyond 

the entities that the Bureau is supervising directly, and so ensuring that consumer groups have the opportunity to respond, to provide information, using the benefit of a lot of the academics that 

are there, looking at this area—— 

Senator WARNER. I would just simply say, though, that if we are 

going to do a rulemaking on debt collection practices without talking to those people who have been targets, customers, consumers, 

users of those debt collection services, I do not know how you can 

reach a conclusion. 

Now, I come and can live with the Ranking Member and many 

on this side. We do not always agree. I generally come with a probusiness bias. I have been in business longer than politics. But I 

have got to tell you, I think the power in most business-consumer 

relationships has shifted away from the consumer toward business. 

And I see this particularly, as we discussed a little bit, in the circumstances around the credit reporting agencies. You and I have 

no option to choose to be customers or not of credit reporting agencies. And I am very concerned not only in credit reporting but as 

we move into increased areas around social media and elsewhere, 

I am not sure that even a relatively informed consumer can simply 

sign away all of their rights with this growing imbalance where the 

business has all the information, all the data, all the tech tools, 

and you are stuck with a ‘‘Click here, I agree,’’ in print that no one 

could read, or even if you could read, you could not necessarily understand. 

Are you concerned about this imbalance between business’ ability 

to collect consumers’ data knowingly, and oftentimes unknowingly? 

And what do you think the CFPB should do to help protect consumers in this growing arena? 

Ms. KRANINGER. Senator, I appreciate the question and enjoyed 

the conversation that we had. Specific to the credit reporting agencies, just to take that, because that is a critical area where the Bureau is spending a significant amount of time, I look forward to the 

results of the Equifax investigation to understand what is happening there, to look at what the Bureau staff has found in terms 

of the concerns, and I do think that the customer relationship there 

is really between the agencies and the financial institutions. So ensuring that the consumer is protected in that situation and that 

they are really limiting the information they are collecting to what 

is appropriate and that they are protecting it and that the consumer has a measure of control and involvement in that going forward is certainly something that makes sense to me. And I look 

forward to getting into that more with the Federal Trade Commission and the Bureau staff, if confirmed. 

25 

Senator WARNER. My time has expired. But, Mr. Chairman, I 

just wanted to note for the record I appreciate your interest in this 

subject, the fact that we have had a couple of hearings. I have got 

to tell you, if this Committee takes up any other legislative activities this year, it is going to be my intent to make sure that credit 

reporting, appropriate guard rules and the fact that it is a year 

after Equifax and still nothing has happened, that is going to be 

at the top of my priority list, and I hope we will be able to work 

together. 

Thank you. 

Chairman CRAPO. It is a high priority for me, too, as well as data 

collection in general, as I have discussed with several of you, and 

I hope that we can prioritize that and make progress. 

Senator Warren. 

Senator WARREN. Thank you, Mr. Chairman. 

So one thing consumers need in a CFPB Director is someone who 

is willing to stand up to powerful people on behalf of those who do 

not have power. And that is why I want to focus on the Trump administration’s child separation policy. 

Since March of 2017, you have been the head of the General Government Programs at the Office of Management and Budget. Is 

that right, Ms. Kraninger? 

Ms. KRANINGER. That is correct. 

Senator WARREN. It is an important job. The General Government Programs Division at OMB is in charge of overseeing both 

the Department of Japanese and the Department of Homeland Security. Is that right? 

Ms. KRANINGER. Yes, Senator. 

Senator WARREN. And according to the disclosures you submitted 

to this Committee, you ‘‘serve as OMB’s principal policy official’’ for 

issues related to the departments and agencies you oversee. Is that 

right? 

Ms. KRANINGER. Yes, Senator. 

Senator WARREN. So the Justice Department and Homeland Security are the two agencies most responsible for taking children 

away from their parents at the border, and you oversee policy 

issues at both agencies. But for a month now, you have refused to 

respond to Ranking Member Brown’s and my request for information for documents relating to your role in child separations. And 

when we met in my office last week, you refused over and over to 

give me a straight answer about your role. 

So today you have given a very lawyerly and limited answer. You 

are dodging. The answers have also been contradictory. You have 

said you have no role in setting the policy, but you also cannot describe the advice you gave on the policy, which means it raises a 

question, which is that you had no role or you had a role and you 

cannot describe it. 

So I am going to ask you again under oath: Were you involved 

in any way in developing or implementing the policies that led this 

Administration to take thousands of children away from their parents at the border? 

Ms. KRANINGER. Senator, I had no role in setting the policy. As 

we discussed, I was unaware—— 

26 

Senator WARREN. Please answer my question. It was developing 

or implementing. 

Ms. KRANINGER. I had no role in developing it in terms of its announcement by the Attorney General, so I was not aware of 

that—— 

Senator WARREN. So you did not help the Attorney General announce it, but otherwise, did you help develop or implement this 

policy? 

Ms. KRANINGER. Subsequent to the Attorney General’s announcement, there were meetings within the Administration on the general topic of the implementation, and, again, the Office of Management and Budget does actually participate—— 

Senator WARREN. So is that a yes? 

Ms. KRANINGER. ——in those meetings. 

Senator WARREN. You were involved? That is a yes? 

Ms. KRANINGER. Senator, again, I do not want to characterize the 

advice, as I noted—— 

Senator WARREN. Well, Ms. Kraninger, I am asking you a pretty 

straightforward yes or no question, and I will remind you you are 

under oath, and lying to Congress is a crime. I will also remind you 

that many of the documents I have requested about your role in 

this policy could eventually become public under the Freedom of Information Act. 

So let me ask again the specific question: Were you involved in 

developing or implementing the policies that led to children being 

taken away from their parents at the border? 

Ms. KRANINGER. Senator, it is difficult to separate the advice—— 

Senator WARREN. I will take that as a yes then. 

Ms. KRANINGER. ——and so as I said, I will not characterize the 

advice that was provided on the analysis or otherwise—— 

Senator WARREN. I am not asking you to characterize. I asked 

you a simple yes or no question. According to reports, in some cases 

the Trump administration is not sure which children belong to 

which parents. As of Monday, the Administration had not identified the parents of 71 separated children, which means right now 

they cannot be reunited. 

DHS is the agency that took parents away from their young children. Did you work with DHS to create a plan for eventually reuniting these children with their parents? 

Ms. KRANINGER. Senator, again, I cannot characterize my advice, 

but as we also discussed, since I was nominated to this position—— 

Senator WARREN. I asked just did you—— 

Ms. KRANINGER. ——I have not been involved—— 

Senator WARREN. ——work with them on a plan. I did not ask 

what the plan was, what advice you gave. Did you work with them 

on a plan to reunite these children who were taken away from 

their parents? 

Ms. KRANINGER. I understand the question, Senator, but it becomes a slippery slope in terms of characterizing the advice that 

was provided or the analysis or the questions that were raised. 

Again—— 

Senator WARREN. No, it is not a slippery slope—— 

Ms. KRANINGER. ——I do not want to characterize any of that. 

27 

Senator WARREN. You do not want to characterize because you 

do not want to admit that you had something to do with this. You 

know, this was a policy that was designed to traumatize children 

and families as a way of scaring them away from the border, even 

if they were seeking asylum, even if they were fleeing death 

threats, gang violence, rape, domestic abuse. 

White House Chief of Staff Kelly said that the whole point of this 

was ‘‘to be a tough deterrent.’’ The American Academy of Pediatrics 

says that being separated from their parents for weeks or months 

can cause these children irreparable, lifelong physical and psychological harm. Do you think that purposefully inflicting that on innocent children is immoral? 

Chairman CRAPO. And please make your answer brief. 

Ms. KRANINGER. Senator, I think there are many heartbreaking 

stories that appear in the news every day from the conversation we 

had about American families, hardworking, who are affected by—— 

Senator WARREN. It is a simple yes or no question. Do you believe that it is immoral to set up a plan whose deliberate intent is 

to inflict harm on children? 

Ms. KRANINGER. Senator, it is not appropriate for me to provide 

my personal opinion and internal deliberations and discussions on 

this matter. 

Senator WARREN. Almost every Member of this Committee, Democrat and Republican, has denounced this policy. Even President 

Trump, when he signed the Executive order ending child separation, said, and I will quote: ‘‘I did not like the sight or the feeling 

of families being separated.’’ But you cannot have an opinion on 

this? You know, I went to the border last month. I met a mother 

who was torn away from her 7-year-old little boy in the middle of 

the night. She could not stop crying. All she could say over and 

over and over is, ‘‘I never even had a chance to say goodbye.’’ She 

had not seen her little boy for weeks. She had no idea where he 

was. 

You see the videos of some of these children being returned to 

their parents after long separations. They are dazed. They are 

unsmiling. They are dirty. It is like the life has been sucked out 

of them. These are innocent children who may be scarred forever 

by this policy. It is fundamentally immoral, and you—you—were 

part of it, Ms. Kraninger. It is a moral stain that will follow you 

for the rest of your life. And if the Senate votes to give a big promotion to you after this, then it is a stain on the Senators who do 

so. 

Chairman CRAPO. Senator Cortez Masto—oh, excuse me. I apologize. I did not see Senator Moran come in. Senator Moran. 

Senator MORAN. I think Senator Rounds is first. 

Chairman CRAPO. Oh, excuse me. Senator Rounds. 

Senator ROUNDS. Thank you, Mr. Chairman. 

Mr. Chairman, what I would like to do is, once we have got the 

noise cleared up here, we will turn around and we will go back and 

ask some questions of both of our two witnesses. Thank you. 

Let me just begin with Ms. Reed. Your role coming in as a chairperson is to make certain that this particular institution, this 

Bank, is capable of competing with other similar type institutions 

from around the country and providing services so that we can 

28 

again properly export to other countries. I think some people think 

that that is inappropriate, that a Government would provide a 

service. I do not. I think that is appropriate that we be competitive. 

Can you share very briefly your thoughts with regard to the appropriateness of competing with other countries and providing our 

businesses with that same type of service so they can compete? 

Ms. REED. Absolutely, sir. Thank you. As I mentioned in my 

opening statement, if we are not at the table, we are unilaterally 

disarmed, and our competitors will take those jobs that should be 

U.S. jobs through their own ECA programs. And I want to be sure 

in this time when we have 109 other ECAs competing against the 

United States that we are there. I think that is so important. 

I know that the Export–Import Bank has a very specific role. It 

is a tool in the toolbox. Dan Runde with the Center for Strategic 

and International Studies (CSIS) published an op-ed in The Hill 

earlier this week, and he lays out the world of China; you know, 

they are using their Export–Import bank, along with many other 

tools, to be present through their Belt and Road policy all around 

the world. And we need to be there not only for economic security 

but also because we need to be there for national security reasons. 

The President says economic security is national security, and so 

Ex–Im is part of that. But we need to be there for our workers. I 

want our workers having these jobs. 

Senator ROUNDS. You know, I was very pleased with the response that you gave to Senator Toomey. I think Senator Toomey 

had expressed concerns that the Eximbank has in the past picked 

winners and losers. I was very happy to hear you comment on the 

fact that you will work with us to make certain that some of those 

things that may have occurred in the past with regard to picking 

winners and losers would not be in the future, so thank you for 

that. I appreciate that. 

Ms. Kraninger, first of all, let me just—I understand that sometimes we run out of time here, and there are some things which 

we, as Senators, we try to get a lot of questions in in a short period 

of time. But sometimes that also means that we do not give you 

the opportunity to clearly lay out your thoughts and to answer 

questions. I think that has occurred today. And, in fact, you have 

been the object so that individuals here that have disagreements 

with the Administration’s policies and their attempts to enforce 

border security and so forth, and they have used you as the object. 

I would like to give you an opportunity to perhaps more fully answer any questions that you think you may not have had the opportunity to answer with regard to any of your activity at OMB 

and the responsibilities that you had at OMB, recognizing that it 

may in many cases just simply be to provide advice. 

Would you like to share with us a little bit, perhaps more fully 

answer the questions that some other Members really were interested in but probably did not have enough time to allow you to answer? 

Ms. KRANINGER. Thank you, Senator. I appreciate that opportunity. The Office of Management and Budget is truly a unique organization in the Government because it has such a broad reach 

into all of the activities across Government. It is kind of a microcosm. And my portfolio is the broadest. So the level of engagement 

29 

that I have in any particular issue or with any particular department or agency does vary substantially. So the question with respect to the IRS rule, I was aware of it happening. I know that my 

staff reviewed it. But, again, I did not have a role in developing 

that. 

With respect to the response to, again, the horrible disasters last 

fall, because there was clear need for additional resources, the Office of Management and Budget was very engaged. And, in addition, with respect to Puerto Rico, the Treasury Department had a 

deep role working with the Government, with the oversight board 

that was established by Congress to look at the future of Puerto 

Rico. And so that is something that, again, there have been many 

meetings on. 

I would also like to note that there are many hardworking men 

and women across the Administration, at the State level, in the 

private and nonprofit sectors that were very engaged in the hurricane response. And so it is an honor to support them and look at 

the resource needs that were brought forward and to submit to 

Congress the resources that we believe were fully justified and for 

Congress to consider that. 

Senator ROUNDS. Let me just—and I know my time has expired, 

but I would ask the Chairman for just a little leniency after the 

last questions that were asked, just to clarify this. You are responsible for over $250 billion in budgetary resources for 7 Cabinet departments and 30 other Federal agencies, including the Treasury 

Department, Department of Housing and Urban Development, the 

Bureau, and all of the financial regulators. You also serve as 

OMB’s principal policy official for issues related to those departments and the agencies. 

I just get the sense that somehow with the huge number of items 

that are in front of you, how much do you get into the specific details? And do you have the opportunity to come back in and say, 

‘‘Wait a minute, I disagree with a particular policy, I can stop it, 

or I can change it’’? Or do you offer advice? 

Chairman CRAPO. And, again, please keep your remarks brief. 

Ms. KRANINGER. Thank you, Senator. It is definitely an opportunity to offer advice. The involvement level really does vary substantially based on the President’s priorities, the Director’s priorities, the agency heads’ priorities, how much authority they have 

on their own. 

Senator ROUNDS. One last item on it. Is your advice always 

taken? 

Ms. KRANINGER. Senator, I wish that it were, but, no, my advice 

is not always taken. At the same time, I am also fallible. But I 

offer my best advice based on the information available. 

Senator ROUNDS. Thank you. 

Ms. KRANINGER. Thank you. 

Senator ROUNDS. Thank you, Mr. Chairman. 

Chairman CRAPO. Thank you. 

Senator Schatz. 

Senator SCHATZ. Thank you, Mr. Chairman. Thank you, Ms. 

Kraninger and Ms. Reed. Thank you for your willingness to serve. 

I just want to follow up on the line of questioning around family 

separation. I understand you cannot characterize the advice you 

30 

gave, but I am wondering if we can get some sense of what categories they were in. Was it legal advice? Was it compliance advice? Was it advice related to execution? Because I think if—I am 

not sure I agree with you about deliberative product. I am not sure 

I agree with you about the sort of vague assertion of—I do not 

know if it is privilege that you are asserting or a personal judgment that you are making or on the advice of counsel, and maybe 

we can get into that. But let us set that aside for a moment. I 

think it is fair for us to know kind of broadly what you did, not 

how you advised people, not how you executed, but were you advising on implementation? Were you advising on compliance? Were 

you providing legal counsel? Were you providing political advice? 

Can you just characterize what you were doing? 

Ms. KRANINGER. So, Senator, with respect to the Office of Management and Budget’s role, which does characterize my role, the 

Director’s role, myriad meetings talking about the agencies as they 

were executing the policy, and we do have at OMB a role for providing perspective on the budgetary resources necessary, any regulatory issues to be addressed—— 

Senator SCHATZ. Why the third person here? Like, ‘‘we have a 

role’’? Every time we ask you about what you did, you say, ‘‘OMB 

has a role,’’ and then it becomes this kind of description of this faraway bureaucrat. It was you, and I am just asking you so that we 

can establish a little trust. You can just sort of characterize what 

you talked about, not to describe the contents of what you talked 

about but, broadly, were you giving legal advice? Were you giving 

political advice? Let us start with that. Were you giving legal advice? 

Ms. KRANINGER. Senator, if I could respond to the point you are 

making because it goes to the heart of the matter. My conversation 

with Senator Rounds, the reason why I am saying the Office of 

Management and Budget is because, as Senator Warren and I discussed in her office, I am responsible for my staff. 

Senator SCHATZ. No. I get that. 

Ms. KRANINGER. So I do have staff involvement. I am also providing advice to the Director—— 

Senator SCHATZ. Ms. Kraninger, I do not have a lot of time—— 

Ms. KRANINGER. I am sorry, Senator. 

Senator SCHATZ. Did you give legal advice? 

Ms. KRANINGER. Senator, it is not appropriate for me to give 

legal advice, really. It is the purview of the Office of Management 

and Budget to weigh in on regulations, budgetary resources, those 

kinds of things. 

Senator SCHATZ. Weighing in on regulations, what does that 

mean? 

Ms. KRANINGER. So, for example, anything that involves data collection, requires notice under the Privacy Act, whether it is a system of records, notice, submission, or a data collection or—— 

Senator SCHATZ. So compliance—can you just please, like rather 

than me playing 20 Questions with you, can you please try to characterize your role in this without running afoul of whatever principle that you articulated earlier, and in as simple and personal 

terms as we can get to where you can say, ‘‘This is basically what 

I did for them. Now I am not going to tell you exactly how I adVerDate Nov 24 2008 11:22 Oct 12, 2018 Jkt 046629 PO 00000 Frm 00034 Fmt 6633 Sfmt 6633 L:\HEARINGS 2018\07-19 NOMINATIONS\HEARING\71918.TXT JASON
31 

vised them or how I’’—‘‘or get into deliberative product.’’ I understand your position on that. But can you not characterize anything 

more than OMB generally does this and that would apply to this 

situation, too? 

Ms. KRANINGER. Senator, I have said that I had no role in setting 

the policy—— 

Senator SCHATZ. Yeah, I got that. 

Ms. KRANINGER. ——and that there—— 

Senator SCHATZ. So what did you do? 

Ms. KRANINGER. ——had been—there were a number of meetings 

on immigration and border security policy, writ large, that I participated in, that I supported the Director and the Deputy Director 

in their participation, and that my staff participated in and then 

came back and told me the nature of—— 

Senator SCHATZ. I have to tell you—— 

Ms. KRANINGER. ——the discussion. 

Senator SCHATZ. ——I do not do hearings so I can put a clip up 

on YouTube. I do not operate that way. And I am trying to get an 

answer from you, and I just cannot. And it is maddening because 

this is not a trivial aspect of your basic qualifications for the job. 

You are coming in and asserting that you are a manager, and you 

cannot characterize anything that you are doing as a manager. 

Let me ask you one final question. Is your position, which is that 

that would get into deliberate product, is that on the advice of 

counsel? 

Ms. KRANINGER. Senator, the documents that were requested in 

the letter is something that I have shared with the appropriate officials, and that includes the Office of Management and Budget General Counsel. 

Senator SCHATZ. OK. But did counsel give you advice and tell 

you not to answer these questions? 

Ms. KRANINGER. Senator, we certainly had a lot of preparation 

for this hearing and discussion about the right answers—— 

Senator SCHATZ. Yeah, so did—— 

Ms. KRANINGER. ——but I will say—— 

Senator SCHATZ. Did you get legal advice? 

Ms. KRANINGER. ——my answers are my own. 

Senator SCHATZ. Did you get legal advice? 

Ms. KRANINGER. Not per se legal advice, sir. I am not asserting 

privilege. It is not for me to do that certainly in this position, but 

I am saying that I want to preserve the deliberative process and 

that that is an important thing to preserve, similar to conversations that many of you have had or I have had with Senators that 

I have worked with. It is important to keep those discussions—— 

Senator SCHATZ. And is that your personal judgment or is that 

the—is that on the basis of advice from either the GC or from the 

White House? 

Ms. KRANINGER. Senator, it is fair to say that there were discussions in preparation for this process that I did have others weigh 

in in terms of giving me advice on how to respond. But my responses are my own. 

Senator SCHATZ. Thank you. 

Chairman CRAPO. Senator Moran. 

32 

Senator MORAN. Mr. Chairman, thank you very much. Thanks to 

both of our nominees for being with us today. I look forward to 

working with both of you should you be confirmed in the capacities 

that you have been nominated to fill. 

Ms. Kraninger, I would start with you. I want to let you know 

how much I appreciate the working relationship that you and I 

have had in your capacity here on the 

Appropriations Committee in the U.S. Senate as well as your 

work at the Office of Management and Budget and indicate to you 

that I appreciate the diligence with which you have pursued my inquiries and issues that I raised in both of those capacities. The 

thoughtful and articulate way that you communicated with me 

about responses and the lack of partisanship in the issues that we 

were dealing with was clearly demonstrated to me, and I am grateful for your professional approach to the way that you conducted 

your work, at least in the experience that I have had with you over 

the last several years during my time as United States Senator. 

My observation about the hearing today on your nomination reminds me of the first piece of legislation that I introduced as a 

United States Senator related to financial services and banking, 

and that was, among other things, the belief that this entity should 

be governed by a board. While there seems to be relish in having 

the opportunity to question you as a potential Director of the Consumer Financial Protection Bureau, maybe we would enjoy it if we 

had three or four or five more opportunities to do so in having 

other people confirmed. And the point, said somewhat with a smile, 

that we would want to go through this four more times, but the 

point I would make is there is a diversity of views on this Committee and in this country about the role of a Consumer Financial 

Protection Bureau. I am of the view that Republicans made a significant error, at least in some, in saying we are going to repeal 

Dodd–Frank and end its reign, and the reaction, unfortunate reaction, to that was many Democrats who said, ‘‘You are not going to 

touch the issues associated with Dodd–Frank.’’ So we put ourselves 

in corners that then caused us to be unable to solve problems that 

clearly existed as a result of the passage of Dodd–Frank with two 

sides saying, ‘‘We are going to do this, and we are not going to let 

you do this.’’ It did not allow us to find a middle ground in very 

many instances, at least until recently, in which we could make 

some improvements or changes in Dodd–Frank. 

One of the changes that I have long promoted is that a board or 

a commission that would oversee a Consumer Financial Protection 

Bureau would make sense. I am not going to ask you your opinion 

about that, but I would raise this with my colleagues to suggest not 

only would it give us the opportunity to have more input with those 

who would be in charge, members of that commission of the Consumer Financial Protection Bureau, but it would also allow us to 

better reflect and perhaps avoid the swings that may occur from 

one Administration to another in the approach that we have had— 

the approach that CFPB has had in regard to the regulatory world 

of protecting consumers. 

I would indicate that it would be valuable to me—and I would 

allow you to respond to this, but it would be valuable to me to confirm what I would expect you to confirm, that you will operate in 

33 

your capacity, if confirmed, in a very transparent and open way so 

that Members of Congress have a better opportunity to influence 

and to make points to you that I sometimes I felt I had with one 

of your predecessors in his Administration, his directorship of the 

Bureau. And I would also make the point that those who are being 

regulated could user greater transparency because I think in too 

many instances rulemaking was not accomplished and, therefore, 

the rules were unknown, and you became—what was the rules of 

the road became known only once there was an enforcement action. 

And so I would give you the opportunity to confirm to me, first 

of all, how you would operate in a transparent way with me and 

my colleagues as Members of the U.S. Senate, and, second, if you 

have thoughts about how we make certain that those who you are 

regulating know what the regulations are before they suffer the enforcement action that often resulted in a fine. 

Ms. KRANINGER. Absolutely, Senator. Thank you so much for 

your comments and for your perspective on this. I completely agree 

that the Bureau—it is a priority for the Bureau to be transparent 

and accountable, that I am committed to working with members of 

both sides of the aisle in Congress to move the Bureau forward in 

that kind of manner. And in terms of the, you know, so-called regulation by enforcement that many have been concerned about in 

terms of the prior approach to the Bureau, I completely agree that 

it is critical to have clear rules so that the lenders and creditors 

and the consumers themselves know what the rules are and that 

they are not somehow told after the fact that they broke a rule 

they were not even aware of or that it had somehow changed without any proper notice and comment process to really understand 

the impacts and the opportunity to tailor, as I have discussed with 

many other Members. So I completely agree that that is not appropriate and is something that I would not engage in. 

Senator MORAN. I appreciate your response. And, Ms. Reed, I 

have run out of time. I would tell you I look forward to working 

with you. I have been on the Banking Committee long enough to 

remember the days in which you would have been a controversial 

nominee, and I am glad to see that Eximbank is back in a position 

in which we can move forward and protecting the competitive interests in a global economy of United States businesses but, more 

importantly, those who work for United States businesses. Thank 

you, ma’am. 

Chairman CRAPO. Senator Cortez Masto. 

Senator CORTEZ MASTO. Thank you. Welcome. Congratulations 

on both your nominations. And let me just say thank you to both 

of you for taking the time to visit with me and answer my questions. I really appreciate that. Welcome to your family as well. 

Ms. Kraninger, I am going to start with you, and these are similar to some of the questions that we had together when you were 

willing to meet with me. But let me just start with this: I have 

heard you say time and again today in response to all of my colleagues’ questioning that your intent is to ensure the Bureau is 

transparent and accountable. But my concern is based on the questioning and the answers that you have given today. We cannot 

even get you to be transparent and accountable about the work you 

are doing at the OMB, the current job that you have. That is fundVerDate Nov 24 2008 11:22 Oct 12, 2018 Jkt 046629 PO 00000 Frm 00037 Fmt 6633 Sfmt 6633 L:\HEARINGS 2018\07-19 NOMINATIONS\HEARING\71918.TXT JASON
34 

ed by taxpayer dollars; that should be transparent to the public. So 

I have concerns that if you cannot even tell us what you are doing 

on a day-to-day basis, how can we trust that you are going to carry 

that over to the CFPB? 

But let me follow up with this: Mick Mulvaney said that State 

regulators and Attorneys General should play an active role in enforcing consumer protection laws in the banking industry. However, as a former Attorney General myself, I know that AGs cannot 

be the only cop on the beat. The CFPB has been vital in uncovering 

widespread and massive fraud and holding those companies accountable, and they are the first stop in the States to protect consumers. 

That is your role as well, my understanding from the statutes 

that I read and what you have said today in your statement. And 

let me give you an example of where the CFPB was instrumental 

for us, the States. Wells Fargo, as you well know, their actions affected 3.5 million people nationwide, including 121,000 in Nevada 

alone. After an investigation by the CFPB, Wells Fargo paid a $500 

million penalty. 

Can you enumerate the powers that the CFPB has that State 

AGs or State regulators do not? 

Ms. KRANINGER. Senator, certainly as we discussed in your office, 

I appreciate your perspective and experience in this area. The partnership with the State regulators is essential, I believe, to the 

point that you noted, the States have been engaged in the enforcement—— 

Senator CORTEZ MASTO. Why do you think it is essential? 

Ms. KRANINGER. I am sorry? 

Senator CORTEZ MASTO. Why do you believe it is essential? 

Ms. KRANINGER. Certainly because the law actually stipulates 

that, and I think that is important, though. They existed prior to 

the Bureau and were engaged in this activity prior to the Bureau’s 

existence. And the statute specifically calls out that important coordination role, whether it is with enforcement actions or—— 

Senator CORTEZ MASTO. Well, let me just say as somebody that 

relied on the CFPB, because I will tell you, in the State of Nevada, 

the regulators were not there when the crisis occurred. Nobody 

stopped it. Nobody was working to prevent it. But when the CFPB 

was created, they were the watchdog nationally to work with the 

States and the States’ AGs, and I will tell you the CFPB has a national view of the issues, and it is not limited by State preemption 

laws. It is key to what happens across this country when we are 

looking to consumer financial protection to work with the States. 

Let me ask you this: Without a strong Federal regulator, how do 

you anticipate States will be able to uncover and put together patterns of wrongdoing, potential wrongdoing across the country? 

Ms. KRANINGER. Senator, I am committed to carrying out the responsibilities of the Bureau under the law, which does include 

working with the States to look for those kinds of things, to work 

with them closely on enforcement matters and give them that national perspective. We talked about the information sharing that is 

vital between the Bureau and the State Attorneys General and the 

regulators, and certainly I am committed to sharing that appropriate information with them to support their efforts and looking 

35 

at the right opportunity for the Bureau to step in from a national 

standpoint. 

Senator CORTEZ MASTO. So outside of serving as a partner for 

State regulators and AGs—rules issued by the CFPB can also be 

enforced by State AGs—do you support empowering the AGs by 

issuing rules through the CFPB? 

Ms. KRANINGER. I believe it is an essential responsibility of the 

Bureau to engage in the rulemaking activities, setting clear rules. 

The example of debt collection—— 

Senator CORTEZ MASTO. So that is a yes? 

Ms. KRANINGER. Yes, Senator. 

Senator CORTEZ MASTO. Thank you. A matter deeply important 

to me is that every American has the right to a day in court and 

that the justice system works for everyone, no matter their race, 

their class, their creed, where you come from, or who you know. 

Let me ask you this: Have you ever signed a contract with a financial firm that included a mandatory arbitration clause? 

Ms. KRANINGER. Senator, I believe that I probably have through 

credit card companies—— 

Senator CORTEZ MASTO. Ms. Kraninger, you are a lawyer. Did 

you read the mandatory arbitration clause before you signed it? 

Ms. KRANINGER. As a lawyer, I do try to read those things, and 

I have actually read them in the past. 

Senator CORTEZ MASTO. Were you aware that you were forgoing 

your right to sue when you signed the contract? 

Ms. KRANINGER. Senator, I certainly was aware of what the 

clauses were that were in the contract. I cannot assure you that 

that is what was there, but I—— 

Senator CORTEZ MASTO. Do you believe that ordinary Americans 

page through and read the fine print of these contracts and know 

that they are signing away their rights? 

Ms. KRANINGER. I am guessing that many of them do not, and 

I think that is why the model disclosures responsibility of the Bureau in statute is important and understanding that the Bureau 

has a role in looking at those things. 

Senator CORTEZ MASTO. Do you support the CFPB’s mandatory 

arbitration rule? 

Ms. KRANINGER. Senator, Congress certainly acted through the 

Congressional Review Act to preclude that rule from going forward. 

So from that standpoint, it is addressed in that manner. I 

think—— 

Senator CORTEZ MASTO. Do you believe all consumers have a 

right to their day in court? 

Ms. KRANINGER. Senator, I believe through contract relationships 

and in general there are opportunities for consumers to take action, 

including coming to the Bureau and submitting their complaints. 

Senator CORTEZ MASTO. Have you ever investigated a bank or 

payday lender or credit card company? 

Ms. KRANINGER. Senator, I have supported investigations in 

many of my roles. I believe actually in terms of financial crimes 

that the Secret Service oversees and Homeland Security Investigations oversees—there has been some involvement with those institutions. 

36 

Senator CORTEZ MASTO. But personally you have never been involved in a prosecution or investigation? 

Ms. KRANINGER. Not of financial institutions directly, no, ma’am. 

Senator CORTEZ MASTO. Have you ever brought a legal action 

and as counsel formulated a case against a bank, payday lender, 

or credit card company? 

Chairman CRAPO. And, Ms. Kraninger, please be brief. 

Ms. KRANINGER. No, Senator, I have not. 

Senator CORTEZ MASTO. Thank you. I see my time is up. Thank 

you both for being here. I will tell you, Ms. Kraninger, I do as well 

have concerns about someone without the experience to lead a Consumer Financial Protection Bureau, 1,600 employees, a billion dollars—or, excuse me, millions of dollars in budget that is looking out 

for the best interests of consumers when it comes to financial products. I have concerns about what I have heard from you today as 

being the right person with the right experience to lead. 

Let me also say, Ms. Reed, I look forward to supporting your 

nomination. Thank you. 

Chairman CRAPO. Senator Reed. 

Senator REED. Well, thank you very much, Mr. Chairman. Thank 

you both for your willingness to serve. 

Ms. Kraninger, I assume you are familiar with the Military 

Lending Act, so if a servicemember would prefer to go to court to 

enforce his or her rights, instead of being forced into arbitration, 

do you think that servicemember’s choice should be protected? 

Ms. KRANINGER. Yes, Senator, to the extent, again, it is provided 

under the law. 

Senator REED. The Military Lending Act has been recently 

strengthened by the Department of Defense with new regulations 

to close loopholes and to prevent unscrupulous lenders from preying upon servicemembers, men and women. And having in my earlier days been an executive officer in a company, I have seen this 

firsthand. 

So do you support the stronger MLA rules? And if confirmed, will 

you enforce them to the fullest extent possible? 

Ms. KRANINGER. Senator, I am absolutely committed to enforcing 

the law. 

Senator REED. The rulemaking pointed out that one of the impacts on servicemembers in their military careers is the financial 

instability caused by being exploited, and that affects their performance. So the Military Lending Act, I am very concerned about 

and involved in. It just helps our readiness. 

One of the things that I think that we had to accept was the 

limit on interest charged to an individual servicemember is 36 percent. Do you think that is too high given the current market rates, 

which even for credit products are about 16 percent? 

Ms. KRANINGER. Senator, certainly the rate varies associated 

with what the product is and what the risks are available. I support competition in the marketplace such that servicemembers and 

others have the opportunity to avail themselves of different options 

in the market based on what their financial needs are. 

Senator REED. The question, I think, is that we statutorily set 

the rate, the top rate at 36 percent. But given current rates in the 

market, which are roughly 16 percent for the return on the Dow 

37 

Jones, my view is I think we should be able to lower those rates. 

So would you be supportive of legislation that would lower those 

rates? 

Ms. KRANINGER. Senator, I appreciate where you are coming 

from and the question, but I do think it depends on what the product is and what the conditions and terms are. There are various 

products in the marketplace. Certainly when it comes to short dollar lending options that are, it differs greatly from the credit card 

products or other products in the market. 

Senator REED. Well, I would hope that we could work, my colleagues and I, to lower that interest rate to make it more competitive to what is available in the market for most products, regardless of how long the duration. 

Did you or anyone with whom you work at OMB on Homeland 

Security or Justice Department issues ever refer to the Administration’s policy of separating immigrant families at the border as a 

‘‘deterrent’’? 

Ms. KRANINGER. Senator, I am not sure that—that may have 

been in public comments by individuals, but I am not sure. 

Senator REED. Have you ever used that? Have you ever heard 

anyone discussing it when they discussed the issue? 

Ms. KRANINGER. Senator, recognizing that in 2014 that was 

something that was discussed and the courts actually ruled on 

that, that was determined at least in, I believe, the Southern District of California as not appropriate. So I appreciate where you are 

coming from on—— 

Senator REED. Do you feel it is not appropriate right now and 

right here? 

Ms. KRANINGER. Senator, these are very difficult, challenging 

issues. A sovereign Nation should defend its borders, I believe, and 

at the same time there are a lot of circumstances from people 

around the world with which—— 

Senator REED. Let me ask a simple question. Do you think separating children from their parents is a way to deter border crossings? 

Ms. KRANINGER. Senator, again, I do not want to talk about 

the—— 

Senator REED. You do not want to talk about it, but I am asking 

you a question. 

Ms. KRANINGER. Yes, I understand—— 

Senator REED. So would you like to be responsive? 

Ms. KRANINGER. I am sorry. I do not want to characterize the internal conversations that—— 

Senator REED. I am asking what you feel, ma’am. 

Ms. KRANINGER. I understand, Senator, but it does go down the 

road of advice and personal opinion—— 

Senator REED. It goes down the road to your values and your 

judgment and those things that we look for when we evaluate 

someone who is going to lead the CFPB. That is where it goes 

down the road to. And you do not want to go down that road, so 

I would suspect that you probably have done that or you feel that 

way. Do you feel that way? 

Ms. KRANINGER. Senator, I do not believe my personal opinions 

or feelings on this issue are the appropriate line of discussion. I unVerDate Nov 24 2008 11:22 Oct 12, 2018 Jkt 046629 PO 00000 Frm 00041 Fmt 6633 Sfmt 6633 L:\HEARINGS 2018\07-19 NOMINATIONS\HEARING\71918.TXT JASON
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derstand why you are asking. I do believe that there are—certainly 

I have been to many places in the world. I have spent time in Guatemala. I served in the Peace Corps. I understand the country that 

we have today is an amazing country where we have many freedoms that others in the world do not. And I certainly appreciate 

that this is a place where people would like to come to enjoy those 

freedoms. 

Senator REED. So I only can assume that you, in fact, used the 

term ‘‘deterrent’’ and did not object to it and feel that is the appropriate policy consideration. Thank you very much. 

Chairman CRAPO. Senator Heitkamp. 

Senator HEITKAMP. Thank you. First, thanks to my colleagues 

who are letting me go ahead of them. I am greatly appreciative, 

and I do not know what it is going to cost me at the end of the 

day, but I am pretty sure it is a big favor coming their way. 

Ms. Reed, I want to again encourage the Chairman to move this 

nomination. He knows how diligent we have been working to get 

the Eximbank up and running. I want to say where I appreciate 

Senator Toomey’s concerns, I do not want to associate myself with 

the characterizations that he made about the Eximbank. I think it 

has been a tragedy, and I am glad you are moving forward, and 

I want to encourage the Chairman to move enough of these nominees now forward with Majority Leader McConnell to get the 

Eximbank up and running. And so, obviously, great credentials. We 

liked you the last time you were here. I think you are perfect for 

this job. Good luck, and we want to do everything we can to get 

you across the finish line. 

Ms. Kraninger, I just have a series of yes-or-no questions, and it 

is not about morality or anything else. It is about your experience. 

And I do not want equivocation, just yes or no, if we can do that. 

Have you ever worked at a bank or a credit union? 

Ms. KRANINGER. Senator, I have not and like—— 

Senator HEITKAMP. OK. 

Ms. KRANINGER. ——many other—— 

Senator HEITKAMP. Have you ever had oversight or regulated a 

bank or a credit union? 

Ms. KRANINGER. No, Senator, I have not, like many—— 

Senator HEITKAMP. OK. Have you ever been responsible for oversight or leadership in supervising payday lenders? 

Ms. KRANINGER. No, Senator, I have not, like many other—— 

Senator HEITKAMP. Have you had experience working with credit 

bureaus, insurance companies, debt collectors, and student loan 

processors? 

Ms. KRANINGER. Senator, in a professional capacity, like many 

other nominees, I have not had direct experience with that. 

Senator HEITKAMP. OK. Have you had any final decision-making 

responsibility for enforcing State or Federal consumer protection 

laws? 

Ms. KRANINGER. Senator, again, like many other nominees approaching different positions, I have not had direct—— 

Senator HEITKAMP. So the answer is no. 

Ms. KRANINGER. ——experience in that. 

39 

Senator HEITKAMP. Have you had any experience under the 

Equal Credit Opportunity Act, any final responsibilities for leadership there? 

Ms. KRANINGER. Senator, I have not, but I have certainly made 

myself familiar—— 

Senator HEITKAMP. Truth in lending—— 

Ms. KRANINGER. ——with these—with these acts and the responsibilities of the Bureau—— 

Senator HEITKAMP. Have you ever worked or volunteered your 

time on matters related to consumer protection? 

Ms. KRANINGER. No, Senator, I do not believe that I have. I have 

certainly volunteered my time—— 

Senator HEITKAMP. Have you ever worked on financial literacy or 

volunteered your time to promote financial literacy, especially for 

youth? 

Ms. KRANINGER. Yes, Senator, I actually have done that. 

Senator HEITKAMP. OK. 

Ms. KRANINGER. I have some experience in working with individuals on that, particularly when I was in college, we did have a program to promote financial literacy and—— 

Senator HEITKAMP. And what did you do to—what was your involvement in that program? 

Ms. KRANINGER. Working a little bit on curriculum in the area. 

Senator HEITKAMP. Good. 

Ms. KRANINGER. So it is something that is definitely important 

to the roles and responsibilities I would be taking on as Director. 

Senator HEITKAMP. Do you have a Ph.D. or Master’s degree in economics or finance? 

Ms. KRANINGER. Like many other nominees in these positions, 

no, I do not. 

Senator HEITKAMP. While you were in law school, what classes 

did you take regarding consumer protection? 

Ms. KRANINGER. Senator, it was a long time ago, so I do not remember every class I took, but I certainly did take the Administrative Procedures—— 

Senator HEITKAMP. But you remember what you did in college 

relative to financial literacy, so—— 

Ms. KRANINGER. Well, the Administrative Procedures Act was 

certainly something that I studied extensively. I took a class in privacy law. I did take a class in other—cybersecurity law actually, 

as a matter of fact. Those are all relevant to the discussions that 

we are having here today, as well as corporations, which I know 

was required of every individual in the program that I took. 

Senator HEITKAMP. OK. Thank you. 

I think the point that I am trying to make is this is a highly 

technical job, and, you know, simply having the skill sets of a law 

degree and having some familiarity with the operation of the Administrative Agencies Practice Act I think gets us to a point where 

we have to judge—I mean, I am not asking you about morality. I 

am not asking you about anything. I am just asking you about your 

core competencies here for the job that you have been nominated 

for. 

And so I think, obviously, you are highly competent and a 

trained professional. I just think that maybe we ought to have 

40 

somebody who understands kind of the—who has had experience, 

as Senator Cortez Masto talked about, with the crisis, has had experience in dealing with people who have—and has empathy. And 

I think, you know, to Senator Reed’s point, you know, it may seem 

irrelevant, but this is a job where literally people are on the edge, 

where they do not know if they are going to make payroll, they do 

not know if they are going to be able to put food on the table. And 

we want somebody in that job who not only has core competency 

but some empathy. 

So I thank you so much, and my time is up, and, again, thank 

you to my colleagues. 

Chairman CRAPO. Thank you. 

Senator Van Hollen. 

Senator VAN HOLLEN. Thank you, Mr. Chairman. I thank both 

of you for your testimony here today. 

Just to follow up, Ms. Kraninger, on some of these questions, because I understood some of the concerns you expressed about not 

getting too deeply into the internal deliberations and advice you offered. I understood that part. But now you are going to be heading 

up an independent agency, right? This is an independent agency, 

is it not? 

Ms. KRANINGER. Yes, Senator, it is. 

Senator VAN HOLLEN. And it is not that you are going to be in 

a line position simply enforcing the policy from above. You are 

going to play a key role in developing policy as the head of an independent agency. And so I do believe your personal views on a range 

of issues are important in that context. And I was not here for all 

the questioning of Senator Warren. I heard Senator Reed’s question. And is it your position that you are not going to answer the 

question about whether or not you personally supported the policy 

of family separation, separating kids from their parents? What is 

your personal view on that policy? 

Ms. KRANINGER. Senator, I appreciate greatly the questions that 

you are raising and am happy to discuss qualifications and my 

judgment. I have certainly always given my best advice to every 

person that I have worked for in my career, and that is very important to me, as well as keeping that advice and perspective close. 

Senator VAN HOLLEN. I think the difference here, as I said, it is 

one thing to not share openly advice that you are giving within the 

Administration. But given the fact that you are now going to head 

an independent agency where your views and positions will definitely inform a lot of the actions that you will take, I do think it 

is troubling that you will not share that information with the Committee. 

Let me ask you about the Office of Fair Lending and Equal Opportunity, because in our State of Maryland, like so many other 

places in the country, we have had a bad history of discrimination 

in lending in many places. There was a case against Wells Fargo 

in Baltimore a little more than 10 years ago. There have been 

other cases where it was established that they discriminated 

against African Americans and people of color. 

Do you agree this is a continuing problem that we have to face 

in this country, fighting discrimination in lending? 

41 

Ms. KRANINGER. Yes, Senator, I do. I think it is incredibly unfortunate. Discrimination should have no place in society, much less 

the markets. But it certainly exists. 

Senator VAN HOLLEN. And one of the things that was established 

when the CFPB was established was the Office of Fair Lending 

and Equal Opportunity, as I mentioned, and one of the first things 

that Acting Director Mulvaney did was he moved the enforcement 

authorities for fair housing out of that office. Would you be willing 

to put those enforcement authorities back into the Office of Fair 

Lending and Equal Opportunity? 

Ms. KRANINGER. Senator, I can assure you that enforcing the fair 

lending laws is a critical responsibility. Whether it happens in the 

Division of Supervision or whether it happens in a reconstituted 

Fair Lending Office, it is definitely something that I can commit to 

you that I will look at and review freshly and talking to the staff 

that are there and understanding how their responsibilities have 

changed in this change. Looking fresh at the organization is something I will do. 

Senator VAN HOLLEN. You know, I think it was rightfully interpreted at the time as weakening the authority, because the idea 

was the folks who were paying close attention every day and doing 

the supervising are probably in the best position to do the enforcement. And having the enforcement authority obviously helps them 

in terms of getting the attention of the folks that they are overseeing. 

The same with the Office of Student Lending. As you know, Acting Director Mulvaney abolished the Office of Student Lending. 

That is not to mean there are not efforts going on in student lending, but would you be willing to reestablish that given the fact that 

we have students who have trillions of debt and in many cases 

there are also issues with respect to their contract, their loan contracts? As you know, there are a number of lawsuits going on. So 

would you be willing to reestablish that office given the centrality 

of that issue? 

Ms. KRANINGER. Senator, I agree with you that student lending 

is an important issue. It is certainly something Congress is looking 

at, and there have been a lot of changes in that under the law in 

recent years. At the same time, I want to note that I will absolutely 

review the structure of the organization, and I will certainly consider that with an open mind. 

Senator VAN HOLLEN. The last thing I will ask regarding the 

child separation policy, you know there has been a court decision 

ordering the Administration to reunite these children with their 

parents within a certain period of time. The Administration has 

missed those deadlines. There is a resource issue. And in your capacity at OMB, I hope you will work with—as you go through this 

process here, I hope you will work with us to get a supplemental 

appropriation, because I am hearing there was an article in Politico 

the other day saying that the Administration was planning on taking resources from other parts of the Department of Education to 

pay the costs of complying with the court order, and I think that 

we would be better served if we find those resources to meet this 

court order without robbing another part of the Department of 

Education. 

42 

Are you familiar with that issue, and can you work with us on 

that as your nomination continues to work its way through the 

process? 

Ms. KRANINGER. Senator, I am not. It must be within the Department of Health and Human Services, which is not my area—— 

Senator VAN HOLLEN. Did I say Department of Education? 

Ms. KRANINGER. Yes, Senator. That is OK. 

Senator VAN HOLLEN. I am sorry. I apologize. You are right, 

Health and Human Services. 

Ms. KRANINGER. It must be within the Health and Human Services, which is not in my purview. But I am happy to take your concerns back. 

Senator VAN HOLLEN. Thank you. 

Chairman CRAPO. Thank you. 

Senator Jones. 

Senator JONES. Thank you, Mr. Chairman. Thank you for this 

hearing. And to our nominees, I apologize for being in and out. 

Schedules get kind of crazy sometimes, so I do apologize. 

Ms. Kraninger, I want to follow up a little bit on a couple of 

things. I know that Director Mulvaney and I think you have talked 

about getting back to the statutory mission of the agency, which I 

appreciate. But one of the missions, one of the objectives is that 

consumers are to be protected from unfair, deceptive, or abusive 

acts and practices and from discrimination. For millions and millions of Americans, that last clause may be the most important, 

particularly people of color. 

Folks these days, someone can look just like I do, which would 

be really said, to be honest with you, but they can look like I do, 

have the same credit, have the same income, have the same profession, and yet another person who has a different skin color would 

get offered a different financial product. 

And so I want to ask, first, do you plan on making fair lending 

a priority if you are confirmed? 

Ms. KRANINGER. Senator, I think it is abhorrent that discrimination exists in society and in the markets, and I am committed to 

enforcing the law, absolutely, to address any of the issues that we 

find in that area. 

Senator JONES. Great. Well, thank you for that. 

Now, discrimination today takes a lot of different forms. It is not 

like some of the old days where you see the white and colored signs 

on water fountains or restrooms. It can be a lot more subtle, and 

sometimes it does not even have the actual intent but can have the 

disparate impact on a group. 

So I would like to get your thought on how you will view cases 

and whether or not you will use disparate impact in looking at the 

broader section of a minority group and whether that would come 

into play and what your feelings are about disparate impact uses, 

because that is used a lot in a lot of legal cases that I have been 

involved in over time, because you cannot always prove the specific 

intent. How do you feel about disparate impact on the use of—in 

your CFPB cases? 

Ms. KRANINGER. Senator, I appreciate the question, and I appreciate the point that you are raising, because, yes, in many cases 

this could be a more subtle action. I think there are a few things 

43 

that the Bureau can do in this area. Certainly in terms of working 

through the supervision process, to your point, if there is no intent, 

this is something that can be looked at. 

At the same time, with respect to court cases and enforcement 

actions, as you are well aware, the arguments about disparate impact are very complicated, and it is a challenging area, legally 

speaking. So I can commit to you that, should I be confirmed in 

this position, when I get to the Bureau, I will have a detailed conversation with the staff on this area to understand what positions 

the Bureau has taken in the past on this issue, and what the status of litigation is on the issue, and take the appropriate actions 

to ensure that we are promoting fair lending. 

Senator JONES. Well, I think they have used it in the past and 

used it somewhat successfully, but Director Mulvaney has said he 

wants to get away from it. Would you be willing to take another 

look at using disparate impact on an entire community, whether or 

not there is a sign that says, ‘‘We are not going to give this person 

a loan because they are black or Asian’’? But if it is affecting a 

broad swath of minority consumers, would you be willing to take 

a look at using the disparate impact theory to try to help resolve 

some issues of discrimination? 

Ms. KRANINGER. Senator, I will commit to you in establishing 

clear rules and making sure that they are enforced that I will look 

at this issue, absolutely. 

Senator JONES. I am not sure if that is a yes or a no. I am going 

to take it as a yes. But I would like to go back to a little bit—I 

was here for Senator Tester’s comments, and I was a little bit—and 

we talked about this the other day. I appreciate your coming in and 

talking to me about the payday lending rules that have been 

worked back. 

I guess what concerns me a little bit in our meeting and then 

with Senator Tester, you had talked about a respect for the process 

and the rulemaking process. But the payday lending rule went 

through a 5-year process. It went through a lot of comments, I 

mean thousands if not tens of thousands or a million. I do not 

know exactly how many, but it was a ton for a 5-year process. It 

got finalized, and then Director Mulvaney on his own decided to 

walk that back and start that process all over again. 

And so I am a little bit concerned that we are now respecting a 

process that has not been respected before. And I would like for 

you to comment on that and what you plan on doing with consumers, because it is a huge issue in my State. I mean, 250,000 

people took out 2 million loans. That is an average of eight of these 

loans per person. And it is a huge process. It is really hurting these 

people a lot. 

So I would like to get a little bit better clarity when you are talking about respecting a process that is already going on. What do 

you mean with the consumer lending right now? 

Ms. KRANINGER. And, Senator, I truly appreciated your time, and 

I recognize it is a difficult issue in many States. They have taken 

different actions for a myriad of reasons, whether it is authority or, 

you know, willingness, frankly, on payday lending. 

What I mean in terms of the process is that the Acting Director 

has announced the reconsideration of that rule, and from that 

44 

standpoint the basis for that reconsideration and what aspects are 

being reconsidered is not something that I am privy to, nor has it 

been discussed publicly. And so that is the process that is ongoing 

within the Bureau right now under active consideration. 

Senator JONES. All right. That is all the time I have. Thank you, 

Mr. Chairman. 

Chairman CRAPO. Senator Donnelly. 

Senator DONNELLY. Thank you, Mr. Chairman. I want to thank 

the witnesses and your families. 

I am a strong supporter of the Export–Import Bank, our country’s export credit agency. It helps American businesses export 

goods and services and compete in our global marketplace. The 

Eximbank does not cost taxpayers dime. In fact, it has returned billions to the Treasury. It protects and creates countless jobs across 

the country. 

In Indiana, since 2012 the Eximbank has directly helped 84 Hoosier companies, including 63 small businesses, to export more than 

$2 billion in goods and services overseas. In 2015 I worked with 

Senator Heitkamp and a bipartisan group of colleagues to end a 6- 

month shutdown of the Bank and enact a long-term reauthorization. 

Unfortunately, Eximbank is still not running at full steam because it lacks the three-fifths board membership required to obtain 

a quorum and approve transactions over $10 million. As a result, 

there is a backlog of $42 billion in deals representing 250,000 jobs 

stuck in a pipeline awaiting approval. We need a fully operating 

Export–Import Bank now more than ever. 

While the U.S. has handcuffed its own export credit agency in recent years, our international competitors have significantly increased their efforts. There are at least 85 foreign export credit 

agencies aggressively supporting their own domestic industries. 

Countries like China, Brazil, and India are doubling down on their 

export credit agencies. Not only that, but current trade policies are 

damaging the foreign markets our Hoosier farmers and manufacturers have spent decades developing. 

Our exporters were already at a disadvantage from a weakened 

Eximbank, and now trade policy is making it worse. To grow and 

maintain a strong economy, we need to send American goods, Indiana goods, all over the world. Our businesses deserve a level playing field with their foreign competitors. Policymakers should make 

it easier, not harder, for businesses to do that. 

Ms. Reed, these are fairly simple questions. You do not have to 

go into a long explanation on them. Do you agree foreign countries 

are aggressively investing in their own export credit agencies in 

order to boost their domestic industries? 

Ms. REED. Yes. 

Senator DONNELLY. Do you agree the U.S. is hurting itself by not 

having a fully functioning Eximbank when its competitors are increasing resources for their export credit agencies? 

Ms. REED. Yes, I do. 

Senator DONNELLY. Do you agree Eximbank helps Hoosier businesses like manufacturers and farmers develop foreign markets for 

U.S. goods and services? 

Senator REED. Absolutely. 

45 

Senator DONNELLY. Just months ago, this Committee approved 

Ms. Reed’s nomination for Eximbank Vice President with an overwhelming 22–3 vote. Now she has been nominated as President of 

Eximbank. I encourage that confirmation as soon as possible to 

bring fresh leadership. Hopefully her confirmation will be followed 

by fellow board nominees, and we can allow the Eximbank to return to full strength for the first time in several years, creating 

more American jobs again. A strong Eximbank bank boosts exports, 

creates jobs, and returns money to our taxpayers. 

Ms. Kraninger, 2 months ago, under Director Mulvaney’s leadership, the CFPB announced it would eliminate its student loan office and merge it into another office. Ms. Kraninger, I do not know 

of an area where young people in my State have incurred more 

debt than in the area of student loans. For many of them, it has 

prevented them from being able to buy homes, being able to buy 

cars, being able to fully participate in our country and our economy. 

A recent report found 60 percent of Indiana’s college graduates leave with student loan debt, and the average is $29,000 per student. I saw your answer to Mr. Van Hollen before about reinstating 

the student loan office. I am a strong supporter of that. You are 

going to review that. I would urge you very, very much to do that. 

What are your plans for protecting student borrowers? 

Ms. KRANINGER. Senator, this is an important issue, and certainly under the law the Bureau was provided the responsibility for 

looking at private student loans. 

Senator DONNELLY. Well, now that they have closed down the office, what are your plans? You said you would take a look at reopening it. What specific plans do you have right now in regards 

to student loans? 

Ms. KRANINGER. So, Senator, there is the position of the private 

student loan ombudsman that was created in the statute, the position that still exists. So certainly a first-order issue is going to be 

sit down with the individuals in that office to understand the activities that they have ongoing. 

I appreciate the priority you are placing in this, and it is certainly something I want to understand better. At the same time, 

with the Federal role in student lending, both in origination—with 

92 percent of the originations today happening at the Department 

of Education and with their efforts to actually bring servicing into 

the Department of Education, I think that is another area that I 

can tell you is a priority. It is sitting down with the officials at the 

Department of Education to talk through what their efforts are 

there, where the Bureau can be helpful, and what role the Bureau 

can play in—— 

Senator DONNELLY. Well, for many of our young people, not only 

in my State, they are looking to you for help because interest rates 

are—if you look at the interest rate on a house and on a student 

loan—and, obviously, they are different products. But you have 

young people paying incredibly high interest rates who look and 

feel they may never get out from under this burden that they have 

and they will never be able to buy a home and they will never be 

able to buy a car. And that is an extraordinarily discouraging situation for people across our country. 

46 

One other question I want to ask. Mr. Mulvaney once called the 

CFPB a ‘‘joke’’ in a sad, sick kind of way. Do you share his sentiment? 

Ms. KRANINGER. Senator, Director Mulvaney has certainly responded to those comments. I can tell you that I support—— 

Senator DONNELLY. I am asking you—yeah. 

Ms. KRANINGER. I support the Bureau as it was established in 

Congress and the roles and responsibilities it was given. 

Senator DONNELLY. But what I asked you is did you think it was 

a sad, sick joke, the way it was being run? 

Chairman CRAPO. I thought that was a good answer. 

Ms. KRANINGER. Senator, again, I support the Bureau’s mission 

and look forward to, if confirmed, vigorously—— 

Senator DONNELLY. Well, this is simply a yes or no. It is like, ‘‘Do 

you like peanut butter or not?’’ Do you think it was a sad, sick joke 

the way it was being run or not? 

Ms. KRANINGER. Senator, those are not words I would use, and 

I believe the Director has responded to those comments since. 

Senator DONNELLY. Thank you very much. 

Thanks, Mr. Chairman. 

Chairman CRAPO. Thank you, Senator Donnelly. 

We have had a request by several Members of the Committee for 

a second round. I will agree to that, although we will hold it to 5 

minutes. The Senators have been taking quite a bit of liberty 

today, and we are well past the time that we should have allocated—or that we have—— 

Senator DONNELLY. I did not take much liberty, Mr. Chairman. 

Chairman CRAPO. I will accept your comment, Senator Donnelly. 

So we will do that, and, Senator Brown, I would turn to you. 

Senator BROWN. Thanks, Mr. Chairman. 

Ms. Kraninger, you talked a lot about accountability and transparency at the CFPB. When you submitted paperwork to this Committee, you had to disclose any campaign contributions from the 

last 8 year above $500, correct? 

Ms. KRANINGER. Yes, Senator, I believe that is—I do not have 

the form in front of me, but I believe that was the request. 

Senator BROWN. Well, you did not make a $500 donation to Governor Kasich’s Presidential campaign, but you made two separate 

$250 donations. You did not disclose that, correct? 

Ms. KRANINGER. I believe—again, I did disclose exactly what was 

requested by the Committee, Senator. I do not remember the exact 

facts. I do not have the paper in front of me. If you do—to note that 

it was above $500, and I—— 

Senator BROWN. I do not believe what you just said was true. 

Well, let me ask again. Did you disclose—you did not disclose the 

contributions to Mitt Romney’s campaign that were under the $500 

threshold but were more than $600 total. So two contributions, you 

did not think that qualified for what you should disclose? 

Ms. KRANINGER. Senator, I believe there was a time period. 

Again, I do not have the documents in front of me. If you have 

them, I would be happy—— 

Senator BROWN. We do, and you made contributions to Kasich. 

You made contributions to Jeb Bush. Do you know of—that should 

have been disclosed under law—or under the rules of this ComVerDate Nov 24 2008 11:22 Oct 12, 2018 Jkt 046629 PO 00000 Frm 00050 Fmt 6633 Sfmt 6633 L:\HEARINGS 2018\07-19 NOMINATIONS\HEARING\71918.TXT JASON
47 

mittee. Did you make any other donations to the 2016 Presidential 

campaign? 

Ms. KRANINGER. Senator, I believe those are the only two that 

I did make, yes. 

Senator BROWN. OK. You did not answer in that first round my 

question on whether you would appeal the 9/11 scammer case. You 

said you would implement the law. Who decides whether to appeal 

or not? 

Ms. KRANINGER. Senator, I am not familiar with the details of 

where that case is. I certainly appreciate the responsibility—— 

Senator BROWN. But who decides whether to appeal a case or not 

at the CFPB? 

Ms. KRANINGER. The Director does have the authority to determine these things. At the same time, if a case is actually headed 

to the Supreme Court, the Bureau does not have independent representation authority to take everything to—— 

Senator BROWN. So do you plan to defend the agency in this case, 

on the scammer 9/11 case? 

Ms. KRANINGER. Senator, without the benefit of being inside the 

Bureau to understand the positions and litigation strategy that was 

taken, that is a very challenging question to answer, and I do not 

want to prejudge that either. The opportunity to speak with the 

General Counsel to understand the positions that they have taken, 

to understand the conversations that they may have had with the 

Department of Justice, given the fact that the Bureau cannot represent itself before the Supreme Court is something that I would 

certainly undertake should I be confirmed. 

Senator BROWN. Not long ago—I think it was in May—Director 

Mulvaney teamed up with a group of payday lenders to sue the 

CFPB, the agency he claimed to be leading and to delay its payday 

rule. You are a lawyer. Do you think agencies should sue themselves to prevent consumer protections from being implemented? 

Ms. KRANINGER. Senator, I think that the responsibility is clear 

in the statute for the Director to carry out the law and manage the 

Bureau appropriately, and that is certainly what I would pledge to 

do. And I would certainly pledge to work with all of you in carrying 

out those responsibilities. 

Senator BROWN. Do you think it is proper for an agency to sue— 

for an agency chief to sue itself, to sue himself, herself, itself? 

Ms. KRANINGER. Senator, I am not familiar with the details or 

the internal deliberation that may have led—— 

Senator BROWN. No, I think you must know about—it is not a 

question of internal deliberations. Do you think it is proper for the 

head of an agency to sue that—to team up with outside interests, 

whether you generally are pro-payday lenders, as Mulvaney from 

his travels and his exhortations and his political contributions certainly would—but whether or not you are close to or supportive of 

an interest group, do you think it is proper for an agency to join 

outside interest groups—an agency chief to sue that agency? 

Ms. KRANINGER. Senator, being unfamiliar with the specific facts 

that you are articulating here, I do not know the basis for the decision. But I—— 

Senator BROWN. I am sorry—— 

48 

Ms. KRANINGER. ——will tell you, Senator, that it is—it would 

certainly be unusual. It would certainly be—— 

Senator BROWN. That was not my—I appreciate your agility and 

facileness. That was not my question commenting on that case. I 

am saying: Do you think it is proper for an agency chief to join— 

you are a lawyer, I am not, so maybe you are at an advantage here. 

But is it proper for an agency chief to join an outside interest group 

to sue the agency itself? 

Ms. KRANINGER. It is certainly unusual. I—— 

Senator BROWN. Thank you. I know it is—we have established 

that it is unusual. We know that. You do not know the specifics; 

at least you say you do not know the specifics of the case. That is 

fine, too. Is it proper for an agency chief to sue its own agency with 

or on behalf of an interest group that has business in front of that 

agency? 

Ms. KRANINGER. Senator, I can tell you that I come to this position without any particular special interest other than serving the 

American people, and I—— 

Senator BROWN. Can’t you just say, ‘‘No, it is not proper’’? 

Ms. KRANINGER. I do not know the details—— 

Senator BROWN. Or, ‘‘Yes, it is proper’’? 

Ms. KRANINGER. ——Senator. I do not—— 

Senator BROWN. Or, ‘‘No, I will never go it,’’ or, ‘‘Yes, maybe I 

will do it’’? 

Ms. KRANINGER. Senator, it is unusual, and I am sure, again, 

there are reasons that that action may have been taken that I am 

not privy to. But, again, I certainly pledge to you that I will carry 

out the duties and responsibilities of this position to the best of my 

ability. 

Chairman CRAPO. Senator Warren. 

Senator WARREN. Thank you, Mr. Chairman. 

All right. So you do not have any experience in consumer finance 

or consumer protection, no qualifications at all. Evidently the one 

thing that you have done in your career is work on President 

Trump’s 2019 fiscal year budget request for the CFPB, and the 

Trump administration has used that, now claiming that this gives 

some insight into how you would run the agency. So this is an ‘‘Are 

you qualified?’’ question that, at least according to the Trump administration, should be directly in your area of supposed expertise. 

Now, let us go through it. To be clear, the CFPB sets its own 

budget, so the budget you proposed had no actual effect on the 

agency. Is that right? 

Ms. KRANINGER. That is correct. 

Senator WARREN. And on top of that, the budget you set for the 

CFPB is a single top-line number. It does not break down how the 

CFPB would adjust its spending to reach that number. Is that 

right? 

Ms. KRANINGER. That is correct. 

Senator WARREN. Good. So you are the budget expert. Let us talk 

about how the CFPB would meet the budget that you drafted. Your 

budget for 2019 calls for a 23-percent cut relative to the CFPB’s 

proposed 2019 budget. That is about a $147 million cut. CFPB’s 

number one expense representing more than half of its total cost 

is compensation and benefits of its employees. Other than the DiVerDate Nov 24 2008 11:22 Oct 12, 2018 Jkt 046629 PO 00000 Frm 00052 Fmt 6633 Sfmt 6633 L:\HEARINGS 2018\07-19 NOMINATIONS\HEARING\71918.TXT JASON
49 

rector and the dozen new political appointees that Mick Mulvaney 

has brought to the agency, every other CFPB employee is a civil 

servant. 

So in order to achieve the 23-percent cut you have proposed, 

would you fire civil servants? 

Ms. KRANINGER. Senator, first let me clarify that it is the President’s budget request and not mine. Certainly I did support its development. 

Senator WARREN. Can we just do this—we are going to be held 

tight on time. Would you fire civil servants? Is that your plan? 

Ms. KRANINGER. Senator, to your point, in fiscal year 2017, 53 

percent of the funds that were utilized under Director Cordray 

were for salaries and benefits of people, and so—— 

Senator WARREN. So are you saying—can you just give me a yes 

or no? Will you fire civil servants? 

Ms. KRANINGER. Senator, there are laws in place certainly that 

protect civil servants, and—— 

Senator WARREN. So is the answer no? 

Ms. KRANINGER. The answer is that 53 percent with salaries and 

benefits, which does leave a significant amount of funds for—— 

Senator WARREN. So will you fire civil servants—Mr. Chairman, 

I am going to ask for extra time if we are going to keep playing 

this game. It is a straightforward—will you fire civil servants? 

That is not hard. This is your area of expertise, your budget that 

you put forward. Do you contemplate firing civil servants to meet 

your $147 million cut? Yes? No? 

Ms. KRANINGER. Again, Senator, it is not my budget. It is the 

President’s budget. 

Senator WARREN. Then does the President’s budget as drawn up 

by you and offered as your expertise for this job contemplate firing 

civil service employees? 

Ms. KRANINGER. Senator, the proposal to Congress is what the 

President’s budget reflects, and it was a decision on the debt and 

deficit situation. That was certainly the focal point for—— 

Senator WARREN. In other words, we are just playing dodge ball 

here. If you are not going to fire civil servants, then let us see how 

you are going to try to make this up. 

Let me try another one. The next largest set of expenditures for 

outside contracts, a big chunk goes to maintaining the agency’s cybersecurity. Do you plan on reducing cybersecurity? 

Ms. KRANINGER. So 31 percent of the funds in fiscal year 2017 

was for outside contractor services. That certainly is a big part 

of—— 

Senator WARREN. Could we please stop playing dodge ball. Do 

you plan to cut expenditures? The next biggest investment is on cybersecurity. Do you plan to cut on cybersecurity? 

Ms. KRANINGER. Senator, I do believe that that other contract 

services line is something that really does need to be examined. 

Senator WARREN. Do you plan to cut on cybersecurity? It is the 

next biggest line. 

Ms. KRANINGER. Senator, cybersecurity and IT investment are 

certainly important to the organization’s carrying out—— 

Senator WARREN. So is that a no, you will not cut? 

50 

Ms. KRANINGER. I think it is something that needs to be examined, absolutely. Every line item does. 

Senator WARREN. Does that mean cut or not cut? 

Ms. KRANINGER. Senator, without being inside the Bureau and 

going through line by line—— 

Senator WARREN. So you might cut cybersecurity? 

Ms. KRANINGER. There could be opportunity—— 

Senator WARREN. OK. 

Ms. KRANINGER. ——within contracts in any area—— 

Senator WARREN. So the next largest expense is travel costs. As 

I assume you know, most of the agency’s travel cost is because the 

agency sends examiners to visit the financial companies that they 

supervise so they can actually make sure that they are complying 

with the law. That supervision is required by Dodd–Frank. Would 

you cut back on examinations and supervision in order to achieve 

the 23-percent cut you need to achieve? 

Ms. KRANINGER. Senator, looking at travel I think is a legitimate 

consideration. At the same time—— 

Senator WARREN. Recognizing that this is travel to go enforce the 

law at the banks, you would cut that back? 

Ms. KRANINGER. I think looking at the travel and looking at the 

efficient distribution of staff is certainly something that is appropriate—— 

Senator WARREN. So you are thinking cutting back so we do not 

send as many people out to enforce. 

You know, I just want to be clear on this. Even if you got travel 

cost to zero, you would not be anyplace close to what you put forward as the proposed budget. So where is the $147 million, the 23- 

percent cut, coming from? Can you just tell me where the areas are 

you plan to cut that is going to get us there? 

Chairman CRAPO. And please keep your response brief. 

Ms. KRANINGER. Senator, this was the President’s budget request, and I pledge to you that I will look at every line item within 

the Bureau’s budget—— 

Senator WARREN. No, you do not—— 

Ms. KRANINGER. ——should I be confirmed. 

Senator WARREN. ——get to dance away from this by saying it 

is the President’s budget. The President has offered you up as saying this is your expertise. Your one piece of consumer protection expertise is you put together a budget for the CFPB. So what I want 

to know is you proposed a 23-percent cut, $147 million. Give me 

some ideas about how you actually would make a $147 million cut 

at that agency? 

Chairman CRAPO. Please respond briefly. 

Ms. KRANINGER. Senator, I believe there are opportunities for efficiency and consideration, and it may involve, frankly, spending 

funds on other activities that are underfunded. So I pledge to you 

that I will look carefully at the budget of the Bureau. 

Senator WARREN. So let us just be clear—— 

Chairman CRAPO. Senator—— 

Senator WARREN. ——I want to be clear on this. She has dodged 

around this for this entire question, line of questions. The one 

thing you have done in your career that is related to the CFPB is 

to come up with a budget number, and the budget number simply 

51 

does not add up. You cannot explain how that agency can do its 

work if it has a 23-percent budget cut that you put together and 

the Trump administration offers as your expertise. The only thing 

you can come up with is, well, maybe you will cut travel, which 

means there will be less enforcement. And I know that will make 

bank lenders happy, payday lenders happy, but it does not reflect 

any knowledge of the CFPB or any commitment to the CFPB’s central mission of trying to protect consumers and level the playing 

field. 

Chairman CRAPO. Senator Tillis. 

Senator TILLIS. Ms. Kraninger, a lot of people have tried to boil 

complex subjects down into simple yes–no answers. There is only 

one that I heard that I felt like we deserved a yes-or-no answer, 

and that was from Senator Donnelly. Do you or do you not like peanut butter? 

[Laughter.] 

Ms. KRANINGER. Senator, I like peanut butter. 

Senator TILLIS. Because outside of that question, I think it is absurd for anybody up here to say that this was nothing more than 

the sort of ‘‘gotcha’’ tactics that some Members use to try and, well, 

support their narrative. 

Now, I want to get on OMB. First off, how big is the CFPB? How 

many employees? 

Ms. KRANINGER. There are about 1,600 employees at the CFPB. 

Senator TILLIS. Do you think that within that employee base that 

you have a few economists and finance experts and people that 

have worked for credit agencies or worked for business lending or, 

you know, any number of financial fields? 

Ms. KRANINGER. Yes, Senator, they have a wide variety of skill 

sets and expertise that is being brought to bear. 

Senator TILLIS. So you as the manager, would you actually see 

yourself getting up in the morning, coming in early, and writing 

out the policies or directing the affairs of the agency and the priorities? 

Ms. KRANINGER. Senator, it is certainly the latter, directing the 

priorities and expecting the staff to put forward the policies that 

align. 

Senator TILLIS. Thank you. How big was the scope of your portfolio—or how big is the scope of your portfolio at OMB with respect 

to the whole of the Administration? 

Ms. KRANINGER. It is roughly a fifth of the total Government, 

$250 billion in resources, 37 agencies. 

Senator TILLIS. So you have a lot of time in your day—I was in 

research and development early in my career in the 1980s up in 

Boston, and I was a product manager. So when we were formulating a technology policy, I would bring R&D, I would bring manufacturing, I would bring finance, I would bring marketing together. 

It was the scientists that worked under my matrix supervision who 

came up with the ideas. And then it was these other organizations 

to figure out the complexities, the pipes, all that you needed to do 

to actually pay for it, administer it. 

Would you kind of consider that to be an analog to your role in 

the Office of Budget and management, not formulating policy but 

implementing it? 

52 

Ms. KRANINGER. Yes, Senator, that certainly is the case, and 

with a wide variety of staff and variety of topics. 

Senator TILLIS. Which is why I find it remarkable that anybody 

would suggest that you were actively engaged in the formulation 

of the policy on child separations. You have certain—if you take a 

look at child separations, it is something I know a lot about because I proposed—I love the passion here about solving the child 

separation problem. I would like to see that rhetoric go from this 

Senate Committee to the floor where we have a solution. And I will 

be talking about it on the floor a little bit later today, because I 

sometimes wonder whether or not people really want to solve this 

problem, or if they want to use it to come here and pretend that 

only the President can solve the problem. It is the Congress that 

can solve that problem, and once we pass that bill, in your current 

capacity, we would expect you to figure out how to implement the 

policy. 

It is frustrating to me to see the passion expressed about certain 

issues in this Committee and an absolute vacuum in the chamber 

where we can actually produce a result. This, by the way, is not 

leading up to a yes–no question. But can you tell me just a little 

bit more about, again, on a day-to-day basis, to what extent in your 

entire tenure in office at OMB that you have ever been actively engaged in crafting the policy choices? 

Ms. KRANINGER. Senator, that is a very fair question. In terms 

of what generally comes before the Office of Management and 

Budget, it is what the agencies are formulating. They put forward 

what their leadership would like to pursue, or they have received 

direction from the President about activities that they should undertake, and they are formulating the manner and how to address 

what the President’s priorities are and what he has asked of them. 

And then we are supporting that effort. 

Senator TILLIS. So, again, first off, I want to congratulate you on 

your nominations, and for the family members, thank you all for 

being here. I know that these hearings can be somewhat troubling, 

but you should never forget the fact that these two nominees have 

had very distinguished careers and are very deserving of the nominations, and you all should be proud of it. Again, I just want to say 

I hope that the focus on child separations that I saw in this room 

translate to people who want to solve the problem. We are down 

to what I consider to be very minor differences. If people look at 

it and within their hearts they truly want to keep families together, Congress needs to fix this problem. You did not craft the 

legislation. You were trying to determine how to implement the 

policy. And we should put a mirror on the Members of the U.S. 

Senate and say, ‘‘Why aren’t you fixing this problem?’’ Thank you, 

Mr. Chairman. 

Chairman CRAPO. Thank you, Senator Tillis. That does conclude 

the questioning. For Senators wishing to submit questions for the 

record, those questions are due in 1 week, on Tuesday, July 24. We 

ask both nominees to respond to these questions by Tuesday, July 

31, so that we can vote that week on the nominations. 

We thank you both for joining the Committee today. As Senator 

Tillis indicated, sometimes these Committee hearings get intense. 

53 

We appreciate you being willing to come forward and put yourselves forward for service to the country. 

With that, this hearing is adjourned. 

[Whereupon, at 12:42 p.m., the hearing was adjourned.] 

[Prepared statements, biographical sketches of nominees, responses to written questions, and additional material supplied for 

the record follow:] 

54 

PREPARED STATEMENT OF CHAIRMAN MIKE CRAPO 

This morning, we will consider the nomination of two individuals to serve in critical leadership roles within the Administration. 

I welcome both of you. Congratulations on your nominations to these important 

offices. 

I see friends and family behind you and I welcome them here today, as well. 

The nominees before us are Kathy Kraninger, to be Director of the Bureau of Consumer Financial Protection and Kimberly Reed, to be President of the Export–Import Bank of the United States. 

These positions are critically important to protecting consumers in the consumer 

financial products and services marketplace, and facilitating global trade of U.S. 

goods and services. 

These nominees bring years of valuable experience at nonprofits and in public 

service, and will provide valued leadership in carrying out the missions of their 

agencies. 

Ms. Kraninger has had a distinguished career in public service with exposure to 

a diverse set of Federal agencies, as well as developing a particular expertise in the 

budget and appropriations processes. 

Since March 2017, Ms. Kraninger has served as Associate Director for General 

Government at the Office of Management and Budget where she oversees and monitors approximately $250 billion in budgetary resources for numerous Cabinet departments and Federal agencies. 

She has also served as OMB’s principal policy official for issues related to the 

Treasury Department, Department of Housing and Urban Development, and Federal financial regulators. 

Prior to joining OMB, she held leadership positions at the Department of Transportation and the Department of Homeland Security, as well as serving on the staff 

of several congressional committees. 

Given her depth and diversity of public service experience, I have the utmost confidence that she is well-prepared to lead the Bureau in enforcing Federal consumer 

financial laws and protecting consumers in the financial marketplace. 

Ms. Reed was considered by this Committee last year as the nominee to serve as 

the First Vice President of the Export–Import Bank, and today we consider her 

nomination to be its President. 

Ms. Reed also has had a distinguished career in public service, previously serving 

as Senior Advisor to former Treasury Secretaries Paulson and Snow. 

In addition, she has served on several Congressional committees, and has held impressive leadership positions in the private sector. 

Ms. Reed is well-positioned to help move the Bank forward in a positive direction. 

With respect to Ms. Kraninger, some senators have requested a long list of documents, including, emails, schedules, involvement in memos, White House communications, etc., relating to Ms. Kraninger’s role at OMB with respect to the Administration’s ‘‘Zero Tolerance Policy’’ and the Administration’s response to Hurricane 

Maria in Puerto Rico. 

These requests are designed to go after certain extraneous Administration policies 

that the requesters do not like, and go far beyond the practice of this Committee’s 

document production. 

Indeed, I would not expect this Administration or any Administration to release 

documents related to an ongoing deliberative process. 

Further, my understanding is that Ms. Kraninger is not the custodian of the 

records and has given the request for information to the White House. 

The Democratic senators of this Committee asked me to delay this hearing until 

after the documents had been provided. 

I am unaware of the Banking Committee delaying a hearing for such a reason. 

To be consistent, I have followed a similar timeline as the Committee set for thennominee Richard Cordray in 2013. 

As a reminder, the Senate received Mr. Cordray’s official nomination from the 

President on February 13, 2013. 

Approximately 1 month later, on March 12, 2013, the Committee held a hearing 

to consider Mr. Cordray’s nomination and voted the nominee out of Committee 1 

week later on March 19. 

Similarly, the Senate received Ms. Kraninger’s official nomination from the President on June 20, 2018. 

Approximately 1 month later, we are holding this hearing. 

She has provided all of the paperwork that the Banking Committee requires. 

The purpose of these hearings is to provide all senators of this Committee the opportunity to ask any questions of this nominee, who will be under oath. 

55 

I intend to ask Ms. Kraninger—again, who will be under oath—about her role in 

developing policy at OMB. 

Other senators will be given the similar opportunity to question Ms. Kraninger, 

and to also follow up with questions for the record, as we traditionally do. 

I take the Senate’s Constitutional authority seriously, and am confident that Ms. 

Kraninger will be sufficiently vetted, as have our previous nominees, for this Committee to provide a recommendation to the full Senate on this nomination. 

As a separate matter, many of us have experienced frustration with the Bureau 

in previous years. 

In April 2016, former Bureau Director Cordray testified before this Committee. 

Senators on the Committee sent questions for the record that same month. 

It took Director Cordray over 16 months to respond to this Committee. 

It is my hope that, if confirmed, Ms. Kraninger will be more accountable to senators on this Committee than Director Cordray was. 

I look forward to a vigorous debate and vote on the nominees. 

PREPARED STATEMENT OF KATHLEEN LAURA KRANINGER 

TO BE DIRECTOR, BUREAU OF CONSUMER FINANCIAL PROTECTION

JULY 19, 2018 

Chairman Crapo, Ranking Member Brown, Members of the Committee, thank you 

for the opportunity to appear before you today. It is a privilege to be here as the 

President’s nominee for Director of the Bureau of Consumer Financial Protection. 

I want to thank President Trump for this honor and for the confidence he has placed 

in me with this nomination. 

I’d also like to express my deepest gratitude to my family and friends who have 

joined me today. In particular—my parents, Dave and Pat, are here from Cleveland, 

Ohio. My older brothers, Dave and Dan, and their families traveled from Wisconsin 

and Connecticut. My younger brother, Matt, and his family are watching online. 

I am incredibly lucky to have an amazing family who encouraged me in every endeavor and taught me that with hard work and dedication, anything is possible in 

this great country of ours. I am especially grateful for their steadfast support as I 

have followed my call to public service and pursued a career serving the American 

people. 

My love for our country, its ideals and promise, drives my commitment to public 

service. It sparked my interest in my university’s summer internship program 

where I worked for my hometown Congressman, now Senator Brown. It inspired my 

decision to join the Peace Corps and volunteer for 2 years teaching in the former 

Soviet Union. There I saw firsthand the devastating impact of communism, the economic consequences of central planning, and the absence of free markets and the 

rule of law. 

Following the attacks on September 11th, 2001, I felt the call even more deeply, 

to help our country in a time of need. I’m very proud to have served on the leadership team at both the Departments of Transportation and Homeland Security during that extraordinarily challenging time. I have also been honored to serve three 

separate Congressional committees, including the Senate Appropriations Committee 

under Senator Shelby’s leadership. In my current position as Associate Director at 

the Office of Management and Budget, I have had the opportunity to take a broader 

leadership role—overseeing $250 billion in budgetary resources and related policies 

for 7 Cabinet departments and 30 other Federal agencies, including the Bureau as 

well as the other financial regulators. 

Throughout my career, I have focused on implementing common-sense solutions 

to complex problems and delivering real value for the American people. While I will 

not prejudge and cannot predict every decision that will come before me as Director, 

if confirmed, I can assure you that I will focus solely on serving the American people. 

Congress established the Bureau of Consumer Financial Protection ‘‘to ensure all 

consumers have access to markets for consumer financial products and services . . . 

that are fair, transparent, and competitive.’’ I am firmly committed to satisfying this 

Congressional mandate. To do so, I would establish four initial priorities. 

First, the Bureau should be fair and transparent, ensuring its actions empower 

consumers to make good choices and provide certainty for market participants. In 

particular, the Bureau should make robust use of cost benefit analysis, as required 

by Congress, to facilitate competition and provide clear rules of the road. In my experience, effective use of notice and comment rulemaking is essential for ensuring 

the proper balancing of all interests. It also enables consideration of tailoring to reVerDate Nov 24 2008 11:22 Oct 12, 2018 Jkt 046629 PO 00000 Frm 00059 Fmt 6621 Sfmt 6621 L:\HEARINGS 2018\07-19 NOMINATIONS\HEARING\71918.TXT JASON
56 

duce the burden of compliance, particularly on consumers and smaller marketplace 

participants. 

Second, the Bureau should work closely with the other financial regulators and 

the States on supervision and enforcement. Nothing is more destructive to competitive markets and consumer choice than fraudulent behavior. Under my stewardship, 

the Bureau will take aggressive action against bad actors who break the rules by 

engaging in fraud and other illegal activity. 

Third, the Bureau must recognize its profound duty to the American people to 

protect sensitive information in its possession. Under my leadership, the Bureau 

would limit data collection to what is needed and required under law and ensure 

that data is protected. This issue clearly needs more attention, particularly because 

many consumers are unaware of the vulnerabilities or unsure of what actions to 

take to protect themselves. 

And, fourth, the Bureau must be accountable to the American people for its actions, including its expenditure of resources. 

As a former Congressional staffer, I appreciate the important role Congress plays 

in overseeing this agency. I value the advice and perspectives you shared during our 

meetings over the past month—conversations that I welcome going forward, should 

I be confirmed in this important position. 

Thank you for your consideration. 

57 


71918101.eps

STATEMENT FOR COMPLETION BY PRESIDENTIAL NOMINEES 

Name: Kraninger 

(Lall) 

Kathleeo 

(r1!11) 

Position to which nominated: Director, Bureau of Coosumer Financial Protection 

Date of nomination: 

Date of birth: 28December 1974 Place of birth: Pittsburgh, PA 

(Day) (Moolll) (Yeor) 

Marital Statu.!: Single Fun name ofspouse: N/A 

Name and ages of chUdren: NIA 

Education: 

(Oillc:r) 

IDititutlon Dalt:taUeodtd Des-recdvcd DalaofdqMarqueue Uoivcnily 9/1993 -5/lm Bachelor of Ails 5/tm 

Geotg<:towo Uoivcnily Law Ctol!<r 9/2003 -SilOIY/ JllrisDodollle Sll001 

Honon 

andawmb: 

List below all scholarships, fellowships, honollli)' degrees, military medals, honoraly 

society memberships and any other special JeCOgnitioos for outstanding service or 

achievement 

Ornoizallon A won! Year 

MW!dte Univmitv Collce.eof Arts and~ YOUIII!Aium!ll oflb Year 2014 

hile!PortPolice lnltn!alional Police and Pnblie SafUv 9/11 Medal 2012 

Ca!!tt for Sllllegjc and IDiemalioJlal Senior Assoe~ wilh 1he llo!Delaud Stcwity and 2010 

Studit$ Counterterrorism Promm 

Departmeot ofHomelaDd Socurily cmifi<81e of Appreeia!ion for Pmidenlial Transition 

I umnnrt 

2009 

Coast Guard Meritcrious Pub lie SeMc:c Am 2009 

a.stoms and Border Prel!<don In recoatilioc ofseniee 2009 

SecureF1jgllt c..tifi<81eofA~ 2009 

lllt!lartment ofHomeland SeQnilv I Seadalv's Award for Exct:llOooal SeMc:c 2008 

Depar1ment of Homeland SeQnily Seattaly's A ward for Team DIIS Excellence for Sealre 2008 

PliRht 

Woshingtoa Slate Depa!lm.<ol of 

I~ 

Cedi1icall of Recognition for COOiribulioo 1o llllhanced 

Dri..r'sLk:ease~ 2008 

I ilel)lrtmenlofHomelandSeQnitv Nallooal ITeam 2007-2009 

Custools and Border Pretedion Commissiooot's Am forEx<OilliooW Setvice 2007 

'l'nlllspor1ati Seeority Admioillntion I Par!nmhioAward 2007 

U.S. Dept of Slate Bureau of Consular 

Affairs 

c..ti6ca!t of AppR<iation 2005 

l~of,.,""""""iM ID~oa ofsavioe 2001 

IMan!-Ullivenity 01113tm~ Seni« of !he Year tm PiSigjnaA!pba Polili<:al Scieacc Honor Socidv member 1996 

I AlpbaSigjnaNu Jesuit HoiiOr Socidv member 1996 
58 


71918102.eps

PhlBdaK- HooouocieiY member 1996 

U.S. Adtie\'!11\a11Acodemv AII·Americu Scholar Cclle2iatt Award 199S 1996 

I~UoJYmitv Di'lisioo ofSiudect AJliirs RCC021litioo Award 1996 

1 AlDha au 0mea homo!e 199S 

M8RIIIdteUoiversitv Academl< Sdlolarship 1993 

Membenhip3: List below allmembmhips and offices held in professiocal, frntemal, business, scholarly, 

civic, cbaritable and olber 01ganizations. 

Orgaaization Membonhip/OIIiee held Data 

Pemsylvania Bar Attooloy At Law, inactive July 2009-Pn:sent 

Center fur~ and lnternaliooal Senior Associate wi1b the Homeland Marth 20J().J8DU8!)'20ll 

5rudies Security and Countertttrorism Prognm 

W'=io Departmtot of Public Teadting OOn!e Jlllltl997tii!Jpirtd(est.3 

lmtructioo years) 

Junior Leag\leofWashillgton. Member 2002·20ll 

Pi Sigma Alpba Alumnus/member 1996-Presml 

AlpllaSigmaNo AlvmlsiD>ember 1996-Prescot 

Pili Beta Kappa Ahmmuslmember 1996-Prescot 

Alpba Oli Omega Alumnus/Vke Prrsidaltlmanber l99S·Prescot 

Employment m:ord: List below all positions held since coUege, including the tide or description of job, name 

of employment, location of work, and inclusive dates of employment 

Title/Deserfption of Job Nameofl!mploymeot Location or Datos ofEmploymt~tt 

Work 

T~employee Robert Half eorpcntion Soloo,OH 6/1997·911997 

Voluoteet u.s. Peace Corps Ukraine 911997 • 1211999 

Assist3ot to the Bxecutlve Dinctor Bush fur Praidint Columbus, OH Jn.ooo • 312000 

Assistant Fio3nce Dirtctor Caow tbr Congrt$s Ridlmood, VA 312000 • 612000 

Assistant OiJtaor of Repo.Jb!i(an Natiooal Pbiladelphia,PA 612000 • 812000 

Transportatioo ConYention 

Advacce Rqmenta!We Buro a-y2000 All!lio, TX &12000 • I 112000 

BxeculiveAssistaot Bush Oleney Transition W&!hington, DC JJ/2000. 1/2001 

Polity Advisor to lbeSecmuy Depar1mt.Dt of Transportation W&1hingtoo. DC l/2001 ·112003 

Advisor to !be s.a.tmy for Policy Departmeot ofHomelalld WashJn&lon, DC 212003 • 41200S 

S<curity 

Professional Stall' Member U.S. Senate, Ccmmiltee on WashJn&lon, DC 41200S • 712006 

Homelaod Sealrity and 

Governmental AJliirs 

ilepllly Assistaot s.a.tmy for Department of Homeland WashiDgton, DC 712006 • JJ/2009 

s-oJog Conrdinatioo S<curity 

Senior Direaor St~~linel HS Group. U.C Wamiogton,DC 11/2009 • 1/20 II 
59 


71918103.eps

l'lllfessioaal Staff Member U.S. House of W&lhillgtoo,DC l/2iliJ.412013 

~YeS,Cco.l!niU<e 

ooA~ 

Cledt U.S. Sallie, Co~ on W8.lhillgtoo,DC 412013 . 312011 

Appupriatiooo 

Associate Director for Gtaeral Offiocof~lllld W8.lhillgtoo,DC 3/2017-Pr.sellt 

Government Budget 

Govermnent 

experience: List any experience in or direct association with Federal, State, or local go'ICIIliD.ents, 

including any advisory, consultative, honorary or other part time SeJVice or posi1ions. 

Title/Associatioo Govel'IIDWII Elltilv Lo<atioll Data 

~ore.peritoet ())yaboga Comity Cotrthouse CleMnd,OH ooe week in 1993 

ln1emship U.S. HouseofRepr=llatives Wasbington, DC S/1995 -1n99S 

-~ShmodBrown 

Vohmteer u.s. Peace Q.wps Ubaine 9/lm-IVI999 

Polity Advisor to tbe SecrdaJy JlepaJtmeot of1'nmportalioo W8.lhillgtoo,DC 112001·112003 

Adviser to tbe s-Illy for Policy llq>artmont ofllorneland W&lhing!oo.DC 212003-412005 

Seaaity 

l'lllfessiooal Sl!ffMember U.S. Sallie, Conunittee oo W8.lhillgtoo,DC 412005 . 712006 

Homeland Secuity aod 

GovmweatalA1faits 

Deputy Assiltmt Seaetary for DepartmeotofRcmelaod W8.lhillgtoo,DC 712006. 11/2009 

Sclming Coonlinatioo Sewrity 

Senior Diruoor ( cootraotor/ Saltine! HS Group, UC Washingloo,DC 1112009 • 1/2011 

COiliU!tanll 

PlllfessioMI Staff Member U.S. House of W8.lhillgtoo,DC 1/2011·412013 

Repmentatives, Committee 

ooA~ 

Cledt u.s. Senate, Committee 00 Washingloo, DC 412013.312017 

Appropriatiooo 

Associate Directcr for Geoctal Office ofMalagemellt and Washillgtou.DC 312017-Preseot 

Go'lel1llll<lll Budget 

Poblished 

Writings: List the 1it!es, publishers and dates of books, articles, reports or other published materials 

you have wriltell. 

NIA 

Political 

Affiliations 

and activities: List memberships and offices held in and services rendered to all political parties or 

election committees during the last I 0 years. 

During the 2012 Pmidenlial general ekdion, I volunteered in the Riclunood, 
60 


71918104.eps

Polifieal 

Vtrginia ooordiD.ation m~fer through the Republiam National Lawyen 

Association and Romney for President. 

ContributioDJ: Itemize all political ~ntributioos of $500 or more to any individual, campaign 

organization, politital party,politital action committee or similar entity during the last 

eight yeaxs and identify specific amounts, dates, and names of recipients. 

QualificatioDS: 

Future employment 

I have not made any political oonlribntioDJ that meet these uiteria. 

Slate fully your qualifications to serve in the position to which you have been named. 

(attad! sheet) 

relallonshlps: I. Indicate whether you will sever all connections with your present employer, business 

firm, association or organization if you are ~nfinned by tbe Senate. 

Potential conflicts 

of inter: 

As I am cumntly a government employee and have no sach oouectioDS, thil 

question does not apply. 

2. As fa.r as am be foreseen, state whether you have any plans after completing 

govemment service to resume employment, affiliation or practice with your previous 

employer, business firm, association or organization. 

I do not have any snch plans. 

3. Has anybody made you a~mmilloolt to a job after you leave govemment? 

No. 

4. Do you expect to serve the full term for which you have been appointed? 

I do. 

I. Desallle any fioancial arrangements or deferred compensation agreements or ollKz 

continuing dealings with business associates, clients or custotnelS who will be 

affected by policits \\tich you will influence in the position to which you have been 

nominated. 

I have no mch amngements, agreemellfa, or dealings. 

2. List any invesbneots, obligations, liabilities, or other relationships which might involve 

potential conflicts of inle!est with the position to which you have been nominated. 
61 


71918105.eps

Civil, criminal and 

investigatory 

acdo11.1: 

I have no Jueh conflicts of inttresL 

3. Describe any business relationship, dealing or financial transaction (other than tax 

paying) whiclt you have had during the last 10 years with the Federal Govemmen~ 

whether for yowse!f, on behalf of a client, or acting as an agent, that might in any 

way constitute or result in a possible conflict of inter with the position to which you 

bavebeennominaled. 

I hav~ no such conflicts of interest. 

4. List any lobbying activity during tb.e past ten years in which you have engaged in for the 

pmpose of directly or indirectly influencing the passage, defeat or modification of 

any legislation at the national level of government or affedfng the adminislration and 

execution of national Jaw or public policy. 

N/A 

5. Explain how you wiU resolve any conflict of inter that may be disclosed by your 

responses to the items above. 

N/A 

I. Oive i!he full details of any civil or criminal proceeding in which you were a defendant 

or any inquiry or investigation by a Federal, State, or local agencyin which you were 

the subject of the inquiry or investigation. 

N/A 

2. Oive the full details of any proceeding, inquiry or investigation by any professional 

association including any bar association in which you were the subject of the 

proceeding. inquiry or investigation. 

N/A 
62 


71918106.eps

Qulificatioas to la'Ve ID tile positloo to wllieh yo11 have been 111111ed 

I briDg two decades of managerial experience and policy expertise stemming liom my dedicated public savice. 

In my current position as the Associate Director for Oeneral Oovernmart at the Office of Management and 

Budget (OMB), I ovenee $250 billion in budgetary reso~ for 7 Cabinet departments and 30 other Fedetal 

agencies, including the Treasury Departmen~ Department of Housing and UJban Developmen~ and Bureau of 

Consumer Financial Protection (the Bureau) and other fllW!Cial regulators. In addition to developing the 

President's budget proposals, such as those related to the Bureau in 2018 and 2019,1 serve as OMB's principal 

policy official for issues related to those departments lllld agencies. To wry out these broad responsibititit$, I 

maaage a 5la1T of caner professionals with deep expertise in their respective domains. As a manager and leader, 

I set the agenda and the tooe, m:ognize the capabilities of the Sial!: and inspiie and empoWiillhem to deliver. 

Through my savice at OMB, two executive braDeh departments and three CongJ:essiooal committees, I have 

built expeltise in the proceslileS of goverJ)Il)ellt including policy development, drafting and eoforcing ~oos, 

oonducting investigatioos, llldget executioa, program and infotmation teclm.ology managemen~ and hU111811 

capital. Further, the role oftbc Bureau as a fiDaocW regulatonequires ooordinalion across f~ and slate 

agencies as well as transparenc:y and slrollg oommunicalion with ~tgulated entities and stakeholders. 

Throughout my caner, I have engaged with a wide spectrum of interagency partners, slate and local officials, 

representatives of foreign governments, regulated industries, and stakeholders to deliver efl'eetive government 

programs and policies. In add:itioa, I have served as an effective spokesperson in the media and with 

stakeholders, including testimony before the Congress. I also have a deep appreciation fur the role of 

CongressioDal committees, lnspeclors Geoeral, and the Oov=ent Acoountability Office as effective oversight 

mecbanim!s. 

Subaltively, I bring experience in cybasecurity, data privacy, information sharing. and finaociaJ regulatioo 

and oversiihl related to anli-mooey JauaderiDg and other financial crimes. In my ament position, I have also 

engaged with the financial IegUiators on fillmcialliteney, fiDtedl, and elfeaiveoost benefit analysis, as well as 

their budgets, !tal property needs, and strategic management issues. 

I have been recognimllhroughout my public service = for my expertise, acoomplishments, dedication, and 

charactet including being honored by the Secretary of Homeland Security with the Award for Bxceptional 

SeMce and the Commandant of the Coast ChJard with the Meritorious Public Service A ward. 

If confinned, I would be honored to serve as the Director of the BUieau. 
63 

PREPARED STATEMENT OF KIMBERLY A. REED 

TO BE PRESIDENT, EXPORT–IMPORT BANK

JULY 19, 2018 

Chairman Crapo, Ranking Member Brown, Senators, thank you for the opportunity to appear before you today. 

Thank you as well for this Committee’s favorable bipartisan vote to advance my 

previous nomination to serve as First Vice President of the Export–Import Bank of 

the United States (ExIm, Bank). 

I now return to you as the President’s nominee to serve as President of ExIm, 

a position that includes serving as Chairman of the Bank’s Board of Directors. I 

thank President Trump for his confidence in me to advance ExIm’s mission: creating 

and supporting American jobs by facilitating the export of U.S. goods and services. 

If confirmed, I will be both the first woman and the first West Virginian to be 

President and Chairman of this 84-year-old institution. 

I also appreciate the encouragement and support of the President’s National Economic Council Chairman Larry Kudlow and diverse organizations focused on American prosperity. 

I would like to recognize and thank my father Terry and sister Ashley. I lost my 

mother, Janet Logue Reed, to cancer when I was 9 years old, and tomorrow would 

be her 70th birthday, so I send her my love and know that she is with us. 

I thank you for the encouraging and supportive individual meetings to discuss 

your views and the positive impact ExIm has made for the workers in your states, 

and the potential to do more to support them. If confirmed, I will work especially 

hard to maintain open lines of communication with you. 

I am grateful for the support of my home-State Senators Shelley Moore Capito 

and Joe Manchin. I would bring the grounding of my West Virginia upbringing to 

ExIm. In 1985, Senator Capito’s father, Governor Arch Moore, bestowed upon me 

a golden horseshoe pin for an academic award that I wear today. Its inscription 

reads: ‘‘Montani Semper Liberi’’—‘‘Mountaineers are Always Free.’’ 

I believe that freedom, in the form of free-market principles, is the best way to 

foster economic opportunity for all Americans. Throughout my 22 year career, I have 

embraced these principles to make a positive difference for our Nation’s businesses 

and workers while also protecting the American taxpayer. I would bring these values to ExIm. 

Still, there is room for improvement to keep America on this road to prosperity, 

and ExIm is no exception. If confirmed, I will work to ensure that ExIm faithfully 

implements all laws and reforms enacted by the Congress. I would launch a review 

to ensure that ExIm truly is the ‘‘bank of last resort’’ and not the other way around. 

There are now 109 foreign Export Credit Agencies (ECAs) in other countries—up 

from 95 when I testified before you last November. (See Attachment.) ExIm recently 

reported on ‘‘the increasing ‘weaponization’ of export trade credit by the world’s 

ECAs to complement increasingly nationalistic trade policies—particularly those initiated by China.’’ If confirmed, I look forward to working with the Administration 

and the Congress on an aggressive response to China’s unfair trade policies. 

In a perfect world, there would be no ECA financing. If confirmed, I will work 

with the U.S. Government and, as appropriate, the OECD, G20, WTO, and other 

forums to move towards the ultimate goal of eliminating all ECA financing. On that 

you have my pledge. 

Until that goal is reached, the United States should not unilaterally disarm in a 

fiercely competitive global economy. While we negotiate, we should not place our 

Nation in a worse position than our foreign counterparts. As President Trump stated regarding export financing: ‘‘[W]hen other countries give it, we lose a tremendous 

amount of business.’’ 

Therefore, if the Senate confirms a Bank Board quorum, I will take responsible 

steps to get ExIm operational so America can compete on a more level playing field. 

ExIm has more than $40 billion in pending applications supporting 250,000 U.S. 

jobs. We need to keep and support these jobs in the United States while we, at the 

same time, work to reform the export subsidies of our competitors to save even 

more. We can do both. 

ExIm also must treat all American companies fairly, especially small- and medium-enterprises. I would ensure that ExIm—working with community banks and 

community development financial institutions that I am so familiar with—helps 

small businesses and the agriculture sector, which is vital to rural America. 

In closing, I would like to underscore that good governance is critical. ExIm, 

which has a very low 0.4 percent default rate, is self sustaining because of the fees 

64 

and loans it charges to the foreign purchasers, and has returned $14.6 billion to the 

U.S. Treasury since 2000. We need to ensure that it stays that way. 

Building on my time working for the Congress on oversight, investigations, and 

Government reform, I would focus on strong standards of conduct, increased transparency, and sound risk management practices. I would work with you and our Inspector General to ensure we are doing all we can to eliminate waste, fraud, and 

abuse and give better value to the taxpayer. 

Thank you for your consideration. I would be pleased to answer any questions. 

65 


71918001.eps

A1TACHMENT 

Statement of Kimberly A. Reed1 

Nominee for First Vice President, Export-Import Bank of the United States 

United States Senate 

Committee on Banking, Housing, and Urban Affairs 

November 1,2017 

Chainnan Crapo, Ranking Member Brown, and Members of the Committee, thank you for this 

opportunity to appear before you today. I am honored to be the President's nominee to serve as 

First Vice President of the Export-Import Bank of the United States (Bank), a position that 

includes being Vice Chainnan of the Bank's Board of Directors. As a West Virginian, I am 

grateful to Senators Shelley Moore Capito and Joe Manchin for their support. 

I am pleased to introduce my father Terry and sister Meghan. My father taught me the 

importance of public service and helping others. My mother. Janet Logue Reed, passed when I 

was nine years old, bul l know that she is with us. My brother Mark, sister Ashley, and brotherin-law Jeremy, a Purple Heart recipient, are watching online. 

My interest in public service was sparked when I was four years old and my father was a counsel 

to the then newly-founded Republican Study Committee. This is 111len I first met fonner House 

Ways and Means Chainnan Bill Archer and his Chief ofStaffDon Carlson. They have supported 

me my whole life, and I am deeply honored to ha1•e them join us today. 

When it comes to helping others, I serve on the Alzheimer's Association National Board of 

Directors. This disease impacts five million Americans and fifteen million unpaid caregivers, and 

my thanks goes to Members of Congress, as well as advocates watching today, who take action 

to end our nation's most expensive disease. 

J appreciated the opportunity to meet many of you to discuss your hopes for the Bank. Creating 

good American jobs is a top priority for the Presiden~ as I am sure it is for all of you. If 

con finned, I will deliver on this priority. We are on the cusp of an American renaissance in 

manufacturing, including for small and new entry companies. 

I am committed to serving our nation, and, if conlinned, look forward to bringing two decades of 

bi-partisan experience to my work at the Bank, which has more than 400 dedicated career 

professionals. Throughout my career, I have engaged not only with CEOs and world leaders, but 

also with thousands of constituents and small businesses in your states. 

As Director of the Treasury Department's Community Development Financial Institutions Fund 

under President George IV. Bush,! made job creation in distressed communities a key priority. I 

oversaw eiTorts to provide$4 billion in financing - in the fonns of New Markets Tax Credits, 

loans, and grants- to financial institutions and economic development groups that were 

investing in our nation's rural, Native American, and urban communities. 

Writzce()p:uing~-IIJ0 JI1 fi~BJ: !11pp ~.,.,.,.banlifi!UC031¢ ~,~.n irno'r~Wiadoc.R«d%.."0T<stimcrr..,tl011-J-17.pdf; V"Idco

l U0111 711aiaJ(RttlJ()p:niu:j;S~ MilltmlS : . ,\t.\\\\.banking.scftMC 20\ ~11.11~1-'t'iccu h-e-scssioCI..,_ 

noati&alion-htW.t 
66 


71918002.eps

As Counsel to three Congressional Committees, I focused on oversight and reform to improve 

our federal agencies. I deeply appreciate the valuable role Congress plays in oversight of federal 

programs, including the Bank, and the importance of faithfully executing all our laws consistent 

"1th the intent of Congress. 

As Senior Advisor to U.S. Treasury Secretaries John Snow and Henry Paulson, I helped advance 

our nation's economic program. I know the value of working as part of an Administration's team 

and making sure Congress and the American people are fully informed about the President's 

agenda. 

Most recently, as President of the l.ntemational Food Information Council Foundation, I worked 

with the U.S. Departments of Agriculture and State in numerous emerging market countries 

around the world to increase acceptance of U.S. exports. 

The Bank has become an important source of funding for small businesses and an avenue for job 

creation. Nonetheless, there are needed reforms to ensure that taxpayer dollars are protected from 

waste and fraud and that Americans are obtaining the best value. 

With respect to the activities of the Bank, my friend, Chaim1an Archer, taught me that any 

reform must not occur :at the expense of our national interests. He 1vamed against unilateral 

disam1ament in a fiercely competitive global economy. J share his concerns and would never 

advocate to place American exporters and workers in a worse position than our foreign 

counterparts. There are now 95 foreign Export Credit Agencies- including eleven acknowledged 

in the past year-many of which are used by foreign governments attempting to move U.S. jobs 

and business revenue to their countries. 

In West Virginia, my grandfather taught me the importance of having the necessary tools in life. 

As an eighth grader during the Great Depression, he launched Reed's Dairy. When private sector 

financing was not available, the Federal Land Bank filled the gap, and the dairy became one of 

the most successful small enterprises in the state. My grandfather farmed for the rest of his life 

and was meticulous with his toolbox. The United States must have the right tools- including a 

fully functioning Export-Import Bank- in our toolbox to be successful in the global 

marketplace. 

But, those tools need to be constantly repaired and reformed. I am especially interested in 

making sure that small and medium enterprises, just the kind of businesses that I am so familiar 

with in West Virginia, bave full access to the programs authorized by Congress. 

If confirmed, l will bring a fresh set Qf eyes to the Bank to strengthen 1).$. competitiveness and 

bring better value to the taxpayer, as the opportunity for Americans to create and export has 

never been brighter. 

Thank you for your co11sideration. I would be pleased to answer any questions. 

4 
67 


71918107.eps

STATEMENT FOR COMPLETION BY PRESIDENTIAL NOMINEES 

Reed 

(Last) 

Kimberly 

(First) 

Ann 

(Other) 

PQSition to wbich nominated: President of the Expon-lmport Bank of the United States 

Date of nomination: June 20,2018 

Date of birth: II Man:h 1971 

(Day} (Month) (Year) 

Marital Status: Single 

Name and ages of childrtn: None 

Education: 

ln$titution 

West Virginia University College of Law 

West Virginia Wesleyan College 

Place of birth: Charleston, WV 

Full name of spouse: N/A 

Dates 

attended 

Degrees 

n:eeived 

1993·1996 J.D. 

1989-1993 B.S. 

Dates of 

degrees 

1996 

1993 

Honors 

and awards: 

List below all scholarships, fellowships, honorary degrees, military medals, honorary 

society memberships and any other special recognitions for outstanding service or 

achievemenL 

• One of the /111111 om~11 L<'l•lm i11 STE.\1 (Science, Technology, Engineering, Math) (2012) 

• U.S. Treasury Meritorious Service Award (conferred by Sceretary Henry Paulson) (2007) 

• U.S. Treasury Secretary's Honor Award (conferred by ScCTetary lobo Snow) (2006) 

• West Virginia Wesleyan College Young Alumni oflhe YtoT Achitvemenl AM·ord (2004) 

• Selected as a "Young Professional Leader" to represent the U.S. in delegations that foster international 

relations: American Council on Gennany(2002, 2008); American Council of Young Political Leaders 

(Morooco, 2005); U.S.-U.K. Atlantic Bridge (2004); U.S.-Asia Foundation (China, 2003); AmericanSwiss Foundation (2001) 

• Youth Awards: West Virginia Governor's Honors Academy (19&8); West Virginia Girl's State(l9&8); 

4-H All Star Pin (highest award in 4-H) (19&8); West Virginia Golden Horseshoe Award (conferred by 

Governor An:h Moore) (1985) 
68 


71918108.eps

Memberships: List below all memberships and offices held in professiooal, fralemal, business, sdlolarly, 

civic, charitable and other organizatioos. 

Organization Office held (if any) Dates 

• Alzheimer's Association-National Board of Directors (2010-Present); Executive Committee (2012· 

2017); Chair, Public Policy Committee (2012-2017); Additional Committees and Task FotteS: Mission 

Outcomes. Audi~ Compensation, Diversity and Inclusion, Governance and Nominating, Bylaws, 

Enterprise Risk Managemeot 

• Alzheimer's Impact Movemeot (AIM)-BoardofiMctors (2012-Prestnt) 

• American Swiss Foundation - Board of Directors (20 I J.Present) 

• Republican National Lawyers Association-Member (2001-Present); Board of 

Governors (2002-Present); Chair (2016-20 17); Co-Chair (20 I 5-20 16); Vice 

Presiden~ Finance (2014); Vice Presiden~ Membership (2002-2004) 

• Natiooal Coalition for Food and Agriculture Resean:b-Board of Directors (2016-2017) 

• Alliance for Food and Hea11h-Executive Committee (2016-2017) 

• West Virginia Wesleyan College - Board of Trustees (2007-2014); Vi~hair, Academic Affairs 

Council (20 11·14). Additional Comminees: Compensation, Nominating 

• Tax Coalition- Member(2001-Present); Board of Directors (2003-2004) 

• Fedenlist Society-Member (1994-Prestnt) 

• American Coimcil on Germany-Member (2002-Prestnt) 

• Women's Foreign Policy Group - Member (2012-Present) 

• P.E.O.lntemational (a women's international philanthropic educational organization)-Member (1989· 

Present) 

• Washington Agricultural ROUDdtable- Member (2009-Prestnt) 

Agibusiness Club of Washington-Member (2009-2016) 

• Republican Women's Federal Forum~ Member (2004-Present) 

• American Society of Association Executives- Member (2009-2017) 

• U.S. Treaswy Department Historical Society - Member (2004-Present) 

• U.S. Capitol Historic:al Socidy- Member (2016-Prestnt) 
69 


71918108.eps

Memberships: List below all memberships and offices held in professiooal, fralemal, business, sdlolarly, 

civic, charitable and other organizatioos. 

Organization Office held (if any) Dates 

• Alzheimer's Association-National Board of Directors (2010-Present); Executive Committee (2012· 

2017); Chair, Public Policy Committee (2012-2017); Additional Committees and Task FotteS: Mission 

Outcomes. Audi~ Compensation, Diversity and Inclusion, Governance and Nominating, Bylaws, 

Enterprise Risk Managemeot 

• Alzheimer's Impact Movemeot (AIM)-BoardofiMctors (2012-Prestnt) 

• American Swiss Foundation - Board of Directors (20 I J.Present) 

• Republican National Lawyers Association-Member (2001-Present); Board of 

Governors (2002-Present); Chair (2016-20 17); Co-Chair (20 I 5-20 16); Vice 

Presiden~ Finance (2014); Vice Presiden~ Membership (2002-2004) 

• Natiooal Coalition for Food and Agriculture Resean:b-Board of Directors (2016-2017) 

• Alliance for Food and Hea11h-Executive Committee (2016-2017) 

• West Virginia Wesleyan College - Board of Trustees (2007-2014); Vi~hair, Academic Affairs 

Council (20 11·14). Additional Comminees: Compensation, Nominating 

• Tax Coalition- Member(2001-Present); Board of Directors (2003-2004) 

• Fedenlist Society-Member (1994-Prestnt) 

• American Coimcil on Germany-Member (2002-Prestnt) 

• Women's Foreign Policy Group - Member (2012-Present) 

• P.E.O.lntemational (a women's international philanthropic educational organization)-Member (1989· 

Present) 

• Washington Agricultural ROUDdtable- Member (2009-Prestnt) 

Agibusiness Club of Washington-Member (2009-2016) 

• Republican Women's Federal Forum~ Member (2004-Present) 

• American Society of Association Executives- Member (2009-2017) 

• U.S. Treaswy Department Historical Society - Member (2004-Present) 

• U.S. Capitol Historic:al Socidy- Member (2016-Prestnt) 
70 


71918109.eps

• Upshur County Historical Society-Member/Supponer (2009-Present) 

Employmtat record: List below all pcsitions held since college, including the title or description of job, name 

of employmen~ location of wor't, and inclusive dates of employment 

TRUMP·Pt:riCE PRESIDE~'TlAL TRANsmONTWt, Washington, DC-Dec. 2016-Jan. 2017 

Agt!K:J lAnding TeiUII Membtr, U.S. DtpGrllflent of tlrt Tnamy 

Note: Tire abo>ot effort was in my pei'$0MI volwnteu Ctlpaciry, unpaid, tmd undertaken on VQCQtion time. 

l~'ltRNATION.UFOOD INFORMATION COUNCIL FOUNDATION, Washington, DC-Sept 2009-Feb. 2017 

hailhnt(Promoted fromE:ttc~~tivtDiretJor Sept 2015) 

1~-n:RNA TIONAL FOOD INFORMATION COUNCIL 

Senior Vice President of Membership, International Relations, and SIJaltgic Jnitiativu 

Note: 1 served in dual execuliw roles foro §501(c)(3) and o related non-lobbying §50/(c)(6). 

MCCAIN·P.WN PR£SIDEII'T1ALCAMPAIGN, New Yorlc, NY - June-Nov. 2008 

Executive Director, NY IAwym for McCain 

Note: The above effort was in my pmoMI volwnteer Ctlpaciry and unpaid. 

L&IIMANBROTRERS,INC, New Yorlc, NY- Dec. 2007-June 200& 

Vice President of Financiaf Markm Policy Rellllions 

U.S. DUARTMEI\i OF THE TRWURY, Washington, DC-May 2004-Nov. 2007 

Dirtcl8r ofdre CillfiiiiMnity D~lopment Fwndlll lnsdiMiions (CDFI) FMnd (Feb.-Nov. 2007) 

Senior Advisor to U.S. Secre/ary of the Treasury (May 2004· Jan. 2007) 

Note: I served as Senior Advisorto U.S. Secretaries of the Treasury John W. Snow and Henry M. Poulson, Jr. 

U.S. BOUSEOFR£PR£SEIITATivtS, WashingiOO, DC- May 1999·May 2004 

Committee on Ways and Means, Oversight Counsel (Apri12001-May 2004) 

Committee on Government Reform and Overslgh4 CDmmlllte Counsel (May I 999- Apri1200 I) 

Omtt OF JOKN T. O'ROURKE, Washington, DC-May 1999 

Legisllllive .Wistant 

U.S.HOUSEOFR£PR£SEIIiAnvtS, Washington,DC-0c:LI997-May 1999 

0/Jite of Rep. Peter HotkstrG (Ml), SpecW Assistant (Feb. I 999-May 1999) 

Committee on Education and the Workforce, Oversight Counsel (Oct. 1997-Jan. 1999) 

REPUBLICAN NATION.u COMMITTEE, Washington, DC-June 1997-0ct. 1997 

CDuiiSll't 0/fiu, l.4w Clerk 

U.S.HOUS£0F REPRISENTATtV!S, Washington, DC-April-June 1997 

0/fia of Rep. SoMy C4IJahan (AL), lntmr 

Do~t-KEMP PREStDEII'TlALCAMPAtGN, Washington, DC- June-Nov. 1996 

Policy Sill// 

Note: The abo>ot effort was in my pei'$0/Ull volunteer Ctlpacity and unpaid. 
71 


71918110.eps

U.S. HOUSE OF REPRESENFATtVF.S, Washington, DC -summer 199S 

Committee 011 House Ways 1111d Men11s Tax Staff, l11tem 

TH£ HERITAGE fOIIX ATIO~, Washington, DC- Summer 1994 

Intern 

TH&WESTVIRCINIA I'ERI~OR'S HONORS ACADEMY, Morgantown, WV- Summer 1993 

Rtsident Assistant 

Gorernment 

experience: List any experience in or dirctt association with Federal, State, or local governments, 

including any advisory, consultative, honorary or other pan time service or positions. 

Note: Please see above respo11se. as all of my go>•emmell/ experie11ce is i11cluded ill my employme11t record. 

ublish!~! 

Writings: list the titles, publishen and dates ofboo~s. anicles, reportS or other publish!~! materials 

you have wriuen. 

• Building Bridges to Connect With Stakeholdm: A Template for Success, Proceedings of the 

International Crisis and Risk CommW!ication Conference, Nicholson School ofCommWiication, 

University of Central Florida, hup>: doi.org 10.3065~ •crcc101S,06112/18 

• Wriuen testimony of and Responses to Questions for the Record by Kimberly A. Reed, Nominee, first 

Vice President, Expon·lmpon Bank of the Unitro States, Confinnation Hearing before the U.S. Senate 

Banking, Housing, and Urban Affairs Commiuee, 11/01/17 

Food Safety: A Communicator's Guide to Improving Understanding, International Food lnfonnation 

Council foundation, 09/23/1 S 

• The Future of Food: Production, Innovation, and Technology, Diplomatic Courier Monthly Magazine, 

05/IS/!S 

• Wrinen testimony of Kimberly A. Reed, International Food Information Council foundation, United 

Nations Hearing on Non-Communicable Disease Prevention and Control Effons, 06/19114 

• Wrinen testimony of Kimberly A. Reed, International Food lnfonnation Council, American Medical 

Association House orDclegates ''Reference Commiuee E'' (Science and Technology) on Council of 

Science and the Public Health Report 2 ·labeling ofBioengineeml food, 06116/12 

• Communication Strategies to Help Roouee the Prevalence ofNon-cornmWiieable Diseases: Proceedings 

from the lnaugurai!FIC Foundation Global Diet and Physical Activity Communications Summit, 

Nutrition Reviews Vol. 70(5):301-310, DO!: IO.IIlllj.I7S3-4887.2012.00480.x, 04/26112 

Wrinen Remarks by CDFI Fund Director Kimberly A. Reed, Gulf of Maine Restarch 111$tityt~ • CDFI 

Fund Joins Maine Senator Olympia Snowe and GO\-ernor John Baldacci in Celebrating Coastal 

Entel)lrises Closing S200 million in New Markets Tax Credits Investments in New England, 08107/07 

• Keynote Address by Kimberly Reed, CDFI Fund, National House and Rehabilitation Association's 2007 

Summer Institute, 07nS/07 

• Keynote Renwks by Kimberly Reed, Director, U.S. Treasury Depanment's CDFI Fund, Frocral 

Resen·e Bank of Richmond's Community De\'elopment Finance Oppo1111nity Worbhop, 06/'lS/07 

• U.S. Depanment oflhe Treasury Community Development Financia! lnsitutions Fund Repon: Gro111h, 

Diversity, Impact: A Snapshot ofCDFis in f\' 2003, Message from the Director, 06/01117 
72 


71918111.eps

• Keynote Add!ess by Kimberly A. Reed, Association for EntQprise Opportunity Annual ConferaK:C. 

OS/1Ml1 

• Written Remarks by Kimberly Reed, Director, CDFI Fund, before the Community Development 

Venture Capital Alliance Annual Conference, 03122107 

• Written testimony of Kimberly A. Reed, DireGtor, Community Development Financial Institutions Fund, 

U.S. Department oflhe Treasury, on Financial Services for Distressed Communities before the U.S. 

House of Representatives Appropriations Committee, Subcommittee on Financial Serviees, 03101107 

During my tenure at the International Food Information Council OF! C) Foundation (2009-2017),1 oocasiooally 

would write science-based, COIISUIIlel·focused website newsletter articles and blog posts on diet, nutritioo, and 

health for the Foundation's website. The following 11t the major subslantive wmples: 

• IFIC Foundation President Kimberly Reed Gives Keynote Address at MidAtlantic Women in 

Agriculture Annual Conference on "Undentanding Our Food: Connecting With Consumers" (includes 

written remarks), 02/09117 

• Switwland's Culinaly Footprint in the U.S.: A Conversation with Ambassador Martin Dahinden, 

OS/21/16 

• Answering the Challenge of"Feeding the Planet, Energy for Life," 11104/lS 

• 'Bringing Biotechnology to Ufe• Classroom Resourte Launched at World Food Prize Symposium, 

10/14/IS 

• IFIC Foundation Releases Food Safety Communicator's Guide in Beijing, 09123/IS 

• IFJC Foundation Hosts EXPO 2015 Communications Summit "Emerging Market Leaders Wortshop on 

Effective Messaging on Global Food Production Issues," 05/20/1 S 

• The Future of Food: Food Production, Innovation, and Technology, OS/18/lS 

• !FIC Foundation Participates in United Nations Hearing on Non-Communicable Disease Prevention and 

Control Effons, 06119/14 

• "Everyone Has a Role:• Update from the 2014 World Health Assembly, OS/21/14 

• Happy Centennial, Coopmtive Elltension: Elltending KDowledge, Cbanging Lives, 05A)8/14 

• Fotty O!ances and 1he 2013 World Food Prize: 'The Next Borlaug Century: Bioteclmology, 

Sustainability, and Climate Volatility,' 10/16/13 

• That's a Movement Highlights from the 68th United Nations General Assembly, I 0/06113 

• World Alzheimets Day: Promoting Optimal Brain Health, 09120/13 

• Tax Day- April IS: Americans Find It Easier To Do Their Own Taxes Than To Eat Wei~ 04114/13 

• Remembering Margaret Thatcher: Revolutionary Reformer of both Freedom and Food Chemislly, 

04107113 

• Women's History Mouth: Women and Girls in 'STEM' Are Key to Feeding Our World, 03104113 

• Reaching the Next G e:oeration to Sustain Modern Agriculturall'r1ctices, I &17112 

• You Are My Sunshine ... Celebrating the Longest Day!, 06118/12 

• Taking It Upstream: Update from the 65th World Health Assembly, OS/22112 

• International Food Information Council Foundation EnCOUlllges World Health Organization to Include 

Science-Based Communication and Behavior Strategies in Global Response to Non-Communicable 

Diseases, 04116112 

• Food to Bank On, 11/03/11 

• Understanding Our food· Presenting the "9 Billion-People Question' to Students, 11121111 

Summary of the International Food Infonnatioo Council Foundation's 2011 Global Diet and Physical 

Activity Communica1ions Summit: "InsightS to Motiwte Healthfu~ Active Lifestyles," 11119/11 

• Reaching a Major Milestone in Securing Global Solutions to NCDs, 09/23111 

• The Importance of Food Banking Around the World, 06126/11 
73 


71918112.eps

• IFIC Foundation Panicipates In Fifst·Ever Food Biotechnology Safety Assessment and Risk 

Communication Forum in China, ll/09/10 

• The World Food Prize· The Next Generntion: Confronting the Hunger Challenges ofTomorrow, 

10/12111 

• Remember th~ People: Update from the 2011 World Health Assembly, 05/17/11 

• IFIC Foundation Reaches Out to Participants of the Filst Global Ministerial Confe~nce on Healthy 

LifesJyles and Noncommunicable Disease, 04125/11 

• Introducing the International Center of Excellence in Food Risk Communication, 04/11/11 

• Making the Investment in Our Future Nutrition and Food Safety Leade~ at Purdue University, I 0104/10 

• International Opportunities for the "Let's Move' Campaign, 05/04110 

• Filst Lady Michelle Obama's 'Healthy Food Financing Initiative" Announcement Highlights the 

Importance of Affordable, Healthful Foods in Unde~rved Communities, 02/19/10 

During my tenure as Director at the U.S. T~ Department Community Development Financial Institutions 

Fund (2007), I wrote the following CDFI Fund website newsletter articles: 

• "Message From the Director," 10/01/07 

• "Message From the Director," 07/01/07 

• "Message From the Director," 03/01107 

I wrote two short pieces for my pe~onal Linked-In Account: 

• Remembering Our Rltinestone Cowboy Glen Campbell: A Champion for Finding a Cure for 

Alzheimer's Disease. 08/09/17 

• Non-communicable Disease ~vention and Control Efforts are Very Important for Global Health, 

10/10/15 

PoUtical 

Affiliations 

and activities: list membe~hips and offices held in and services rendered to all political parties or 

election committees during the last I 0 y~. 

None. Note: While I served as a volunteer whip for the Republican National Committee Rules Commillee 

meeting on July 14, 20/6, and have occasionally volunteered on an unpaid basis at election time,/ have not 

"rendered services" to paliti.cal parties or election commitrees during rhe lasr I 0 years. 

Potitlcal 

Contributions: Itemize all political contributions of$500 or more to any individual, campaign 

organi2ation, political party, political action committee or similar entity during the last 

eight yeaiS and identify specific amounts, dates, and names of recipients. 

• Alzheimer's Impact Movement PAC: $1500 (09-01-14); $500 (02-06-14); SIOOO (03-27-13); $500 (06-

17-11) 

• Sen. Roy Blunt-$1500 (04-04-16) 

• Sen. Jeny Mor.ID • $1500 (08-05-15) 

• Rep. Barbara Comstock· S500 (09-30-14) 

• Jeb Bush for President -S2700 (06-15·1 5) 

• Right to Rise USA· $1000 (03-27-15) 
74 


71918113.eps

• Min Romney for President • $1000 (04-04-12); $1000 (07-26-ll) 

• Republican National Lawye~ Association: $1000 (05/01117); $500 (06129/16); $1000 (04/01116); $1000 

(07/14/14); SlOOO (08/24113); $1000 (08/29/12); SlOOO(II/19/10); $800 (10/09/10) 

Quati6Clltions: 

See Allachmenl/. 

Future employment 

State fully your qualifications to serve in the position to which you bave been named. 

(attach sheet) 

relationships: I. Indicate whether you will sever all connections with your present employer, business 

firm, association or organization if you are confinned by the Senate. 

NIA. 

2. As far as can be foreseen, state whether you have any plans after completing 

government service to resume emp oymen~ afliliation or practice with your previous 

employer, business finn, association or organization. 

No. 

3. Has anybody made you a comm.itment to a job after you leave government? 

No. 

4. Do you expett to serve the full term for which you have been appointed? 

Yes. 
75 


71918114.eps

Poteodal coallicu 

of interest: I. Desaibe any financial amngemeniS or deferred compensation agrumeniS or other 

continuing dealings with business associates, clients or customers who will be 

affected by policies which you will influence in the position to which you have been 

nominated. 

None. 

2. List any investments, obligatioos,liabmties, or other relationships which might involve 

potential c:oal1icu of interest with the positioo to which you have been nominated. 

Nooe. 

3. Desc:ribe any business relationship, dealing or financial transaction {other !han tax 

paying) which you have bad during the last I 0 years with the Federal Govemmen~ 

whether for yourself, on behalf of a clien~ or acting as an ageo~ that might in any 

way constitute or result in a possible conflict of interest with the position to which 

y()u have been nominated. 

None. 

4. List any lobbying activity during the past ten years in which you have engaged in for 

the purpose of directly or indirectly influencing the passage, defeat or modification 

of any legi.slatioo at the oatiooallevel of government or affecting the administration 

and executioo of oatioaallaw or public policy. 

I have never been a registered lobbyist and have neva lobbied as part of my professional 

career. 

I, however, in my personal capacity as a non-compensated volunteer, have met with 

lawmakers as part of my personal involvement with the Alzheimer's Association and 

the Alzheimer'slrnpact Movement. For example, I annually join 1200+ 

Alzheimer's advocates from across the United States for the annual Alzheimer's 

Advocacy Forum in Washington, DC. The Forum includes visiiS with lawmakers to 

share personal stories, introduce caregivers, and urge support for Alzheimer's 

researcll, including through legjsl1tion and public policy. This personal effort, 

however, does not meet the deflllition oflobbying activity. 

5. Explain how you will resolve any conflict of interest that may be disclosed by your 

responses to the items above. 

I have no conflicts of interest. If ever there is a potential conflict of interest (unforeseen 

at this time),l will work with EXIMBank's Designated Agency Ethics Official and 

recuse myself or take other steps as recommended and appropriate. 
76 


71918115.eps

Civil, criminal and 

lnvtstigalory 

actions: 

I cunently serve oo the N&lional Boa!ds of both the Alzheimer's Association, 1 

§501(cX3) organiution, and the Alzheimer's Impact Movemeo~ 1 §SOI(cX4) 

organization, IS well IS the Board of the American Swiss Foundation. As provided 

in my Ethics Agreemen~ I will resign from these Boards if confinned by the U.S. 

Senale. 

I. Give the full delails of any civil or criminal proceeding in wbicb you were a defeodanl 

or any inqui!y or inmtigation by a Federal, Slale, or local agency in which you were 

the subjecl of the inquiry or investigation. 

As is often COIIlDIOD in superviSOI}'positions in lbe Federal government, when I was tbe Direcloroftbe U.S. 

Trwury Oepartmall's Community Developmeol FinanciallnstiMioos (CDFI) FU!Id (February-November 

2007), there were EEO claims filed and/or in-process a gains! the U.S. 0epartmeo1 of the Trwury !hal required 

me 10 be inlerviewed and lestify al ooe EEOC bearing. I do DOl have any delailed recollection aboul the claims 

IS this was eleven yean ago, bul all claims were either dismissed or delermined 10 have "no finding of fault" 

Also during this time, the TIQS\ll)' Office oflnspeclor General received an anonmyous complain! concerning a 

CDFI Fund slaffmember's !Javel voucher and I WIS inlerviewed. The Office oflnspeciOr General concluded 

!hal there was no evidence lo indicale the violalion of any lravel voucher regulation and lhallhe allegalion was 

unsubslantiated. The investigation discovered no violalions of Federal code or Treasury reglations and lhe file 

was closed. 

2. Give tbe full delails of any proceeding. inquiry or investigation by any professional 

I!SSOCiatioo including any bar associatioo in which you were the subject of the 

proceeding. inquiry or investigation. 

Nooe. 
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2. List sowteS, amounts and dates of all anticipated receipts from defened income 11!811gemeots, stock 

options, uncompleted contracts and other fulllre benefits which you expect to derive from previous business 

relationships, professional selvioes and firm membe!sbips or from former employers, clients, and customm. 

None. 

The Wldmigned certifies that the informatioo contained hertin is true and correcL 

Signed: Date: 06125118 

Attachment 

13 
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71918117.eps

Attachment 

STATEMENT FOR COMPLETION 

BY PRESIDENTIAL NOMINEES 

Kimberly Ann Reed 

Position to which nominated: President of the Export-Import Bank of the 

United States 

Quatillcations: State fully your quallllcations to serve in tbe position to which you bave been 

named. 

June 25,2018 

Dear Membe~ of the U.S. Senate Committee on Banking, Housing, and Urban Affairs: 

I am humbled by President Trump's nomination of me on June 20, 2018, to se!Ve as President of the Export· 

Import Bank of tbe United States. It is an honor and a privilege to be considered for this position. 

It also was was an honor to be previously nominated by the President on October 3,2017, as First Vice 

President of the Export-Import Bank and testify before you on November I, 2017. I am grateful for this 

Committee's favorable vote <On my nomination on Deceinber 19,2017, and your support throughout this very 

lengthy process. 

As requested in your Senate application,! would like to share my qualifications that have prepared me to se!Ve 

in this position. 

Background Summary 

I am a senior executive with a 21-year career leading organizations and initiatives in the governmen~ nonprofit, 

and private secto~. including efforts that have focused on American job creation, business, fmance, trade, and 

economic development issues. 

I most recently seiVed as President of the International Food lnfonnation Council (IF! C) foundation. Working 

with global food and agriculture supply chain, health experts, academicians, government officials, and 

journalists, the IFIC Foundation is the nation's leading non-profit focused on communicating science-based 

infonnation about health, nutrition, and food safety for the public good. As part of my work,! collaborated 

with the U.S. Departments of Agriculture and State to increase acceptance of U.S. food and agriculture exports 

in emerging market countries around the world. 

I previously se!Ved in the following positions: Director of U.S. Treasury Department's sole pt program- the 

Community Development Financial Institutions (CDFI) Fund-wbere I was responsible for overseeing the 

award of nearly S4 billion in tax credits, loans, and grants to financial institutions and economic development 

14 
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groups for investing in e(()nomically dislreSSed communities; Senior Advisor to U.S. Treasury Secretaries 

Henry M. Paulson, Jr. and John W. Snow; (:()unsel to three (:()ngressional Committees in the U.S. House of 

Representatives-the House Ways and Means, Government Refonn and Ove~igh~ and Education and 

Workforce (:()mmittees; and Viee President for Financial Markets Policy Relations at Lehman Brothe~ in New 

York. 

In my pe~nal capacity, I volunteer on seven~! non-profit boards, including the Alzheimer's Association, 

American Swiss Foundation, and Alzheimer's Impact Movemen~ and previously on the boards o(West Virginia 

Wesleyan College, the Tax Coalition, and the National Coalition for Food and Agriculture Research. I was the 

Mt woman to he elected as Chair of the Republican National Lawym Association Board ofGovemo~ in 

2016. 

Named one of the "100 Women Leadm in STEM" (Scienee, Technology, Engineering, and Math), I have been 

honored with the U.S. Department of the Treasury Meritorious Serviee Award and Secretary's Honor Award 

and West Virginia Wesleyan College Young Alumni Achievement Award. I have been recognized as a "Young 

Professional Leader" by the American Swiss Foundation, American Council on Gennany, Atlantic Bridge, and 

American Council ofYoung Political Leade~. and teach democracy-building cowses in emerging nations in 

order to advance frtedom and women's rights around the world. 

Originally from Buckhannon, West Virginia, I hold a law degree fiom West Virginia University College of Law 

and a dual undergraduate degree in biology and government and a minor in chemistry from West Virginia 

Wesleyan (:()llege.l am a Certified Association Executive (CAE) through the American Society of Association 

Executives (ASAE), earned a Professional Certificate in Finanee from the New York Institute ofFinanee, and 

have spent time in more than one hundred countries around the world. 

Additional Qualifications and Core (:()mpetencies 

Oversight and Reform Experience: I am committed to preventing waste, fraud, and abuse. This commitment 

began during my tenure as Counsel to three (:()mminees with the U.S. House of Representatives, where I was 

charged with perfonning ove~ight on behalf of the U.S. Congress and the American taxpayer. I worked with 

the Inspectors General, Government Accountability Offiee, Federal Bureau of investigation, National Taxpayer 

Advocate, IRS Oversight Board, and numerous Federal agencies, and many of these efforts resulted in 

Congressional ovmight hearings and positive changes for the American taxpayer. As a member of various 

non-profit boards, I was involved in ove~ight from strategic and fiduciary levels. Because of my recognized 

judgment and emphasis on sound internal operations and controls, I was asked to serve on an Enterprise Risk 

Management Task Force and an Audit (:()mminee. If confinned, I will make effective oversight of the Bank 

consistent with the Export· Import Bank's charter rt~juirements a top priority. I also look forward to working 

with (:()ogress to ensure the Bank is compliant with all laws. 

Communications, Public Relations, and Outreach Skills, with a Focus on Small BusiDesses and Jobs: One 

of my strongest skills is being an enthusiastic communicator. In each of my positions,! have served as a 

c~ble voice, conducted ou~ch ill a multitude of venu~ across the U.S. and world, and focused on good 

customer and stakeholder serviee. I have engaged and built networks with a variety of diverse audiences 

!311ging from the United States Congress, Fortune 500 CEOs, and Chambers of (:()mmeroe to thousands of 

small businesses, community bankers, employers, and workers to the general public and the press. From 

putting together fifty. five (:()ngressional roundtables and site visits with hundreds of American workers, 

including unions members, during my Mt job at the House Education and Workforce Committee to engaging 

with thousands of stakeholders focused on our U.S. agriculture and food supply chain during my most reeent 

tenure as President of the IF! C Foundation, I have demonstrated my commitment to sharing and learning 

through good public relations. If confinned, I will bring this same passion to the Export-Import Bank, 

15 
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71918119.eps

especially Ill a.pand awmness of its SeJVices through focused small business development and American job 

growth and prosperity. 

Orgulzatiooal Leadership: As a leader of large, medium, and small-sized organizations and on various 

boards, I am familiar with lite importance of competing, time-sensitive demands, including from Congress and 

the White House, staff, board members, and stakeholders. My leadership and judgment have been recognized 

by Treaswy Secretaries John W. Snow and Henry M. Paulson, Jr. (see allachmenl) and Members of Congress. 

During my tenure at the IFIC Foundation, I beeame a Certified Association Executive (CAE). As a CAE, I put 

my leadmbip skills into action. For example, the IFJC Foundation CTWed a staff-led "Values Team" to 

strategically improve our organization. I also took action through two strategic planning cycles to ensure our 

work involved collaboratioo with divme U.S., foreign, and muli-latml stakeholders to address cballenges such 

as feeding a growiug global population, which will increase from 7.6 billion people Ulday to 9.& billioo by the 

year 2050. As part of my volunteer work oo the Board ofDirectocs of the Alzbeimer's Association (and its 

Executive Committte~ we UDdertook a bold orgmizatiooalleadmbip step to transform the organi%atioo from 

many individual chaplm across the nalioo into one single unified organization dedicated to eodiog the disease. 

As a Certified Association Executive (CAE), I have mastered core competencies needed to enhance 

organizatiooal sucoess and create a culture of collaboration and efficiency, and I bave put those competencies 

into action. And, because of my past Executive Branch experience, I also recognize that su=ful 

organizational leadership requires participation in the inter-agency process. While at the U.S. Depar1ment of 

the Treasury, I engaged with the National Economic Council, State Departmen~ Commerce Depar1ment, and 

Small Business Administration, among others, to arrive at the best outcomes for the U.S. taxpayer. If 

confumed, I will create an environment that fosters high performance and innovation. 

Trustworthinss: I bave an established track record of trustworthiness and confidentiality. I have been a 

confidential advis« to U.S. Cabinet Semtaries and elected officials. I was eotrusted by the U.S. Congress and 

J.RS. asooeofthe limited individuals who bad access to private §61031aXpayerinformation in order to 

cooduct Congressional oversight I have had a Top-Secret (SCI} security clearance. I am a dependable 

overseer of initiatives and fioances for government progJamS wO!th billions of 1aXpayer dollars and excel at 

issues management to protect my stakeboldm and organizations, as well as to respond to any poteutial 

concerns of the U.S. Congress. If confirmed, I will bring a culture of trustworthiness and integrity to the 

Export-Import Bank. 

Commitment to Government Reform and Transparency: Starting with my first position with the U.S. 

Congms, where I was responsible for reviewing and providing feedback on the U.S. Department of Labor's 

very first strategic and annual plans as required under the then newly-implemented Government Perfonnance 

and Results Act (GPRA), I have been dedicated to the need for government reform. Building on seven years of 

oversight work for the U.S. Congress, one of my key committoents as Director of the U.S. Treasury 

Departrmnt's CDFI Fund was reform and transparency. For example, during my tenure, the CDFI Fund 

released its very first comprebeosive analysis and data from over 200 CDFls and made the data available to 

goveromeo~ reseaJtbm, and othm so that they could coaduct further analysis. Tbe report serves as a useful 

tool for those inl!ttSttd in bow these financial institutions operate, the p!Oifuds and semces they offtr, and the 

imJ*! they are making in the communities they suve. I also launcbed the first-ever "CDFI Fund Policy 

Research lnitialive." to build a strong foundation oflmowledge documenting the overall role, impact, and fu~ 

possibilities of all CDF!s, something that! betieve is aitical to outline a path for our greater result-based fu~ 

success. If confirmed, I will be committed to Export-Import Bank reform and transparency. 

Stntegic VIsion to Improve the Business Environment: I have a track record of short- and long·tenn 

planning skills, which is done in collaboration with organizational leadership. While heading the CDFI Fund, I 

commissioned an independent third party consulting organization to do a complete analysis of the Fund's 

16 
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71918120.eps

processes toea= we wm openting at a 21"century level and protecting taxpayerdollan. As a mul~ 1he 

CDFI Fund's flagship program and review processes wm ~tuRd and strengthened. This strategic vision 

also extends to my role on non-profit boalds, where I have been a part of several strategic planning processes. 

A recent major initiative was a two-year Alzheimer's Association "Mission Forward" restructuring process that 

unified 80 independent non·profits into a single, nationwide organization. If confirmed, I will bring strategic 

visions to support actions that improve the ease of doing business with the Export-Import Bank. 

Business, Trade, FinancW Services, Economic Developmen~ and International PoUcy Experience: In 

addition to having ten years of Legislative and Executive Branch experience,! also have experience with small 

and large business, trade (with a focus on exports), fllll!ICial institution, economic developmen~ and 

intematiooal policy issues. 

For seven and ooe-half years at 1he IFIC FOII!Idatioo, I collabcnted with agriallture and food indusby supply 

chaio, amcog others. In 2015, this sector employed 21 million, or 11.1 pen:ent of total U.S. employment-the 

single largest employment sec10r in the United States. lied strategies to build U.S. and international 

engagement, cross·func:tional alliances, and consumer trust. One of my key initiatives was securing U.S. 

Department of Agriculture Fon:ign Agriculture Service Emerging Markets ProgJam (Commodity Cn:dit 

Corporation) financial support to enable our foundation to work with thousands of emerging market counby 

leaders and stakebolders. We hosted science-based summits and workshops in diverse emerging market 

countries, including China, Indonesia, Vietnam, Egypt, Wesi/Easl Afiica, and India, to expand knowledge on 

food and health issues and, as a n:sult, improve the business environment for U.S. companies engaging in trade. 

The export of U.S. agricultural products will continue to be a very important issue and opportunity for our 

country and world over the next several years, especially as the world's population (and mouths to feed) grows 

from 7.4 billion today to 9.7 billion by 2050. 

During my shcrt tenure at Lehman Brothers in New York (whid! began j\1$1 as the 2008 fiDaDcial crisis was 

unfolding) ~ in the newly-mated position of Vice President of Financial Markets Policy Relations, focused oo 

building a new outn:acb effort to engage with global trade associations and policy giOUJIS, including those in the 

European Union, China, India, Brazil, and the Middle East. In 2009,1 obtained a Professiooal Certificate in 

Finance fiom the New York Institute of Finance. I took the following oou=: Essentials of Banking, 

Essentials ofU.S. Capital Markets, Commodity and Energy Markets, Fundamentals of the Securities IndUSby, 

Finance for Non· Financial Managers, and Budgeting in a Non· Profit Organization. Both of these experiences 

incn:ased my knowledge of the financial services sector. 

During my tenure as the Director of the CDFI Fund,! focused on access to capital, financial inclusion, job 

cn:ation, and ecooomic groW1h in economically distressed rural, urban, and Native American communities and 

with under-served populations. During the 2007 fUnding cycle, I worked with 68 talented CDFI Fund staff to 

allocate $3.9 billion in tax m>dit authority and award S42 million to a combined total of almost 200 

organizations committed to investing in and providing fmancial services to low-income communities and 

individuals across the country. Through the CDFI Fund's various programs, I eogaged with a range of 

stakebolden, including eommunity and luge barW, eredit uniw, loan funds, mieroloan funds, and veorurt 

capital providers. I also met many of lheir stakeholders, including those involved with small businesses, charter 

schools, beallh clinics, neighborhood housing services, financial education centers, and childcare centers, as 

well as citizens in the Gulf Opportunity Zone (GO Zone) trying to put lheir homes and lives back together after 

Hurricane Katrina. 

I have a strong inten:st in international issues and engagemen~ and I will always put America first. 

Professionally and personally,! have spent time in more than I 00 countries, including many OECD and 

emerging market countries. I also am on the Board ofDin:ctors of the American Swiss Foundation, and have 

17 
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71918121.eps

bad numerous "soft diplomacy" oppol1\lllities 10 engage with Swiss company executives, bankm, and 

government officials on topics including trade, competitiveness, and foreign investment 

If confirmed, l will bring Ibis knowledge, experience, and understanding 10 the Export-Import Bank. l also am prepared 10 uphold lhe Bank's charter and bylaws, work collaboratively wilh the United States Congress, and 

ensure lhe Bank is transpafe!Jt and a good steward of taxpayer dollars. 

For me, there would be no greater honor or responsibility !han being confirmed as President of the ExportImport Bank of the United States, espetially alibis pivotal time in our nation's hisiOI)' and because of the 

critical role the Export-Import Bank plays in creating jobs and growing lhe economy in the United States. 

I look fOIWIId to the opportunity to meet with eacb of you 10 8IISWtr your questioos and learn more about the 

issues that aJe important to you. Thank you for your coosiden1ion. 

Sincerely, 

~a.tJ Kimberly Reed 

Attachment A: U.S. Treasury Secretary's Honor Award and Meritorious Service Award Citations 

t8 
83 


71918122.eps

ATIACHMENT A 

U.S. Treasury Secretary's Honor Award 

Conferred by Secretary John W. Snow (2006) 

Kimberly Reed has served the Oepar1ment ofTreaswy and Secretary Snow as Senior Advisor 10 the Secretary 

with dislinetion, dedication, and skill. Her accomplishments are numerous. She has been at the center of the 

policy coordination process for the Dqlartmen~ and an indispensible advisor on such issues as fundamental tax 

refonn, retirement security, and significaot domestic economic initiatives. She helped coordinate the 

Dqlartment's response to hwricaoes Rita and Katrina, and the Gulf Coast rebuilding effort. Sbe went on to 

facilitate the Dqlarlment's process to monitor and prepare for global financial risks of all kiDds, such as 

pandemic Ou. lo the tax area, she bas been rapoasible for the review and clearance of all tax regulations for the 

Secretary's office, a significant and time consuming task. Sbe bas been a primary liaison with Commissiouer 

Everson, the Internal Revenue Service, the IRS Oversight Board, and the National Taxpayer Advocate, helping 

to coordinate and improve conunuoications between the Department and its !Mgest bureau. Sbe led effort 

within the Department to highlight the President's concern for economic development in America's 

communities, most notably the operation of the New Marlcets Tax Credit Of particular note were her 

remarlcable and effective efforts to promote and advance the President's economic message to taxpayers across 

America. 

lo recognition of all ber significant contributions and accomplishments, Kimberly Reed is awarded the 

Secretary's Honor Award. 

U.S. Trwury Meritorions Service Award 

Conferred by Secretary Heary W. Paulsoa, Jr. (2007) 

Kimberly Reed bas served Prtsideot George W. Bush and 11V0 Treaswy Secrelaries with integrity and 

distinction as Senior Advisor to the Secretary at the U.S. Dqlartment of the Treaswy. 

As Senior Advisor, Ms. Reed bas provided invaluable counsel to both Secretary Paulson and Secretary Snow on 

key policy matters, especially for tax and economic issues. She also bas played a major role in coordinating 

issues with the Department and its bureaus, as well as with the White House and other Agencies, and was 

involved in the day-to-day management of Departmental operations. Ms. Reed has been not only a trusted 

advisor 10 Secretaries and two Chiefs of Staff, but also a fervent supporter of the President's economic agenda. 

Her knowledge ofissues, keen political judgmeo~ and understanding ofall branches of governrnent were 

invaluable. Sbe approached ~h day and tackled each wignment with energy and optimism. 

Ms. Reed is~ throughout the Treaswy and its buraus, the Congress and the Wbite House for her 

teamwork, good na~. hard work and unwaverin& dedication to the Presiden~ the Secretary, and 1he successful 

execution of their priorities. 

lo recognition of her distinguished record and contributions to the Departmen~ Kimberly Reed is presented the 

Meritorious A ward. 

19 
84 

RESPONSES TO WRITTEN QUESTIONS OF SENATOR BROWN 

FROM KATHLEEN LAURA KRANINGER 


71918201.eps
85 


71918202.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

• In accordance with Dodd-Frank Act Section 1035(c) requirement to "ensure 

coordination" with the U.S. Depanmem of Education "in providing assistance to and 

serving bcrrowers seeking to resoh•e complaints related to their private education or 

Federal siUdent loans", how do you plan to direct the CFPB to work with the U.S. 

Depanment of Education to resolve complaints related to bcrrowers' federal student 

loans? 

Response: As staled in my previous responses, I know that student lending is a significant 

issue for many Americans and one that I will examine close!)'· I plan to sit down with 

officials at the U.S. Department of Education to talk through what their efforts are, where 

the Bureau can be helpful, and what role the Bureau currently plays at a more detailed 

level. I am aware thai Section 1035 contemplates a Memorandum of Understanding 

between the Department and the Bureau, and I will work towards that end. 

• As you are likely aware, the U.S. Depanment of Education's Office of Federal Student 

Aid ("FSA") is planning a pilot program for a federal payment card for students' 

financial aid. This card could eventually ha1•e implications for millions of federal student 

loan bcrrowers and grant recipients, and may have widespread implications for the 

financial industry as well. Do you believe it is imponant for the CFPB to be consulted in 

an ongoing fashion abcut the development and operation of the payment card initiative, 

including sharing feedback during the pilot program? 

Response: I am committed to carrying out the responsibilities of the Bureau under the law, 

which includes working with the U.S. Department of Education. Information sharing is 

1•ital between the Bureau and other regulators. I am committed to sharing feedback as 

appropriate about the Department's pilot program. 

We would like clarity on the CFPB'senforcement trends: 

• How many CFPB investigations were ongoing as ofNol'ember 24, 2017? 

• How manyCFPB investigations were ongoing as of April 19, 2018? 

• How many new CFPB investigations were initiated from November25, 2017 to April19, 

2018? 

Response: The information you request in the three questions abo,·e is information that is 

not available to me. As I noted in ms testimons, under my stewardship, the Bureau will 

take aggressive action against bad actors who break the rules by engaging in fraud and 

other illegal activit)'· 
86 


71918203.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

• In January, Mr. Mulvaney announced that the CFPB would reconsider its 2017 payday 

loan rule and delay the compliance date for the rule's main requiremenls. He claimed 

that he plans to undertake a great deal more cost-benefit analysis at the CFPB. Did he 

undertake any cost-benefit analysis in connection with the decision to revisilthe payday 

loan rule and delay the compliance date for the rule's main requiremcnls? If so, please 

provide a copy of that analysis to the Comminee. 

Response: The information )'OU request is information that is not available to me. 

In a speech 10 state anomeys general in February, Mr. Mulvaney implied that the CFPB would 

step back if state authorities "don't think it's against the la11?' or "don'tthink it's your state's best 

interest." This was in the context of a case against four payday lenders accused of charging 

triple-digit imerest rates in 1•iolation of state and federal law. Mr. Mulvaney noted that some 

state atton1eys general opposed the case. 

But what Mr. Mulvaney didn't mention was the fact that this case charged the lenders with 

making illegal loans in fifteen different states, 111th varying policies on payday lending. 

• Did the state anomeys general of any states other than New Mexico and Oklahoma 

express an opinion on the case? If so, please provide copies of any wrinen 

correspondence. 

Response: The information )'OU request is information that is not a1•ailable to me. 

• According to the CFPB's complaint, Connecticut and New York state authorities sent 

cease-and-desist letters to some of the lenders telling them the loans were illegal. Did the 

CFPB reach out to those states to solicit their opinion? If so, why does it seem that the 

CFPB took the advice of the stales that Mr. Mulvaney agreed with and dismissed the 

advice of those he disagreed with? 

Response: The information you request is information that is not available to me. 

• What is the statutory authority for making the opinions of some state authorities 

detemlinative in CFPB's decision to pursue an enforcement action to protect consumers 

in other states? 

Response: While any decision by the Bureau to pursue an enforcement action against any 

person will depend upon the unique facts and circumstances of the case, the following 

pro1•isions at least suggest that the Bureau should consider the 1•iews of the various states, 

when relevant and applicable, in its decision-making process. Section 1021 of the DoddFrank Act requires tile Bureau to seek to enforce the law consistently. Additionally, Section 
87 


71918204.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

1042 of the Dodd-Frank Act empowers states, in consultation with the Bureau, to enforce 

pro•·isions ofTitle X and Bureau rules issued thereunder. Howel'er, the l'iew of any one 

state would not be dispositi1·e under my leadership of the Bureau, should I be confirmed. 

• If the CFPB chooses not to bring an enforcement action because cenain state authorities 

recommend against it, how is that consistent with CFPB's role as a federal regulatory 

agency to enforce federal law? 

Response: Ginn the information in the response above is not available to me, I do not 

have the appropriate context to fully address this question. As I stated abow, under my 

stewardship, the Bureau will take aggressil•e action against bad actors who break the rules 

by engaging in fraud and other illegal actil·ity. Furthermore, as explained in my testimony, 

I beliel'e the Bureau sl10uld work closely with other federal financial regulators and the 

relevant state agencies on superrision and enforcement. 

• Did the CFPB undenake any cost-benefit analysis in connection with the decision to drop 

this case? If so, please provide a copy of that analysis to the Comminee. 

Response: The information ou request is information that is not a\'ailable to me. 

In 201 1, the CFPB entered an agreement with state anomeys general to suppon each other in 

enforcing consumer protection laws, including through 'joint or coordinated inl'estigations of 

wrongdoing and coordinated enforcement actions." State anomeys general from coast to coast 

have said they've appreciated the CFPB's pannership in the past. However, Virginia Attorney 

General Mark Herring recently said that the CFPB is now dropping cases that were previously 

approved. In light of these comments, we are concerned that Mr. Mulvaney has abandoned the 

CFPB's previous agreement to suppon state etTons to protect consumers. 

• How many CFPB investigations or lawsuits in which the CFPB worked with state 

authorities were ongoing as of November 24, 2017? 

• How many CFPB investigations or lawsuits in which the CFPB worked with state 

authorities were ongoing as of April19, 2018? 

• How many new CFPB investigations or lawsuits in which the CFPB worked with state 

authorities were initiated from November 25, 2017 to April 19, 2018? 

• Since November 25, 2017, has Mr. Mulvaney or CFPB staiTdenied any requests by state 

authorities for the CFPB to join or suppon an investigation or lawsuit? 
88 


71918205.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19,2018 

• Is the Virginia Attorney General correct, and if so, which cases or investigations have 

been dropped? If so, did the CFPB undertake a cost-benefit analysis before coming to a 

decision to drop those cases? Please provide a copy of an analysis to the committee. 

• Does Mr. Mulvaney continue to adhere to the CFPB's 201 1 agreement with state 

attorneys general? If there have been any changes to the CFPB's approach to working 

with state authorities, did Mr. Mulvaney personally approve these changes? 

• If there have been any changes to the CFPB's approach to working with state authorities, 

did the CFPB u~dertake a cost-benefit analysis in connection with those changes? If so, 

please provide a copy of that analysis to the Commiltee. 

Response: The information you request in the questions above is information that is not 

available to me. As I hare noted, under my stewardship, the Bureau will take aggressive 

action against bad actors who break the rules by engaging in fraud and other illegal 

acti,•ity. I also believe the Bureau should work closely with other federal financial 

regulators and the relevant smte agencies on supervision and enforcement. 

Mr. Mulvaney claims he received approval to hire several political appointees to the 

CFPB. Please provide copies of that appro,•alto the Committee. Additionally, did the 

CFPB perform any cost-benefit analysis in connection with the decision to hire these 

employees or set their salaries? If so, please provide copies of that analysis to the 

Committee. 

Response: The information you request is information that is not available to me. 

At a hearing, Mr. Mulvaney claimed he "did not quash an)1hing at OIRA," and that in fact "no 

one" had quashed an)1hing. However, Bloomberg Law previously reponed that "Labor 

Department leadership convinced OMB Director Mick Mulvaney to overrule the White House 

regulatory a flairs chief and release a controversial tip-sharing rule without data showing it could 

allow businesses to skim S640 million in gratuities." We have several follow-up questions: 

• Was there any dispute between OIRA Administrator Rao and the Department of labor 

about whether the Department should include certain quantitative analysis in materials 

accompanying the tip-sharing regulation? 

Response: I han no personal knowledge of the issues surrounding this rule. 

• Was there any initial opposition by Administrator Rao to publishing the regulation 

without certain quantitatil•e analysis? 

Response: I ha\"e no personal knowledge of the issues surrounding this rule. 
89 


71918206.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19,2018 

• Have you ever been aware of Mr. Mulvaney, as OMB Director, intervening in disputes 

between the OIRA Administrator and the head or staff of a federal agency (such as the 

Department of labor)? 

Response: In light of the confidentiality interests that attach to executil·e branch decisionmaking, I am unable to answer this question. 

• Did you or Mr. Mulvaney play any role, direct or indirect, either yourselves or through 

your agents or political appointees, in resolving any dispute related to the tip-sharing rule 

between the OIRA Administrator and the Secretary of Labor or the stan· of the 

Department of labor? If so, please describe that role. Did the Secretary of Labor or the 

staO"ofthe Dep.artment of Labor request your intervention related to the tip-sharing rule? 

Response: I hal'e no personal knowledge of the issues surrounding this rule. 

Mr. Mulvaney expressed concern at a hearing about the handling of personal data by third parties 

with which the CFPB has contracted. Senator Perdue asked if, "every single factor that I have as 

an individual in the United States, every single financial factor can be re1•iewed, and can be 

collected, and can be exposed by the CFPB, is that cornect?" In creating the CFPB, Congress 

required the Bureau to monitor consumer financial products and services, including 

developments in those markets. It also limited the Bureau's market monitoring authority to 

prevent the Bureau from obtaining infom1ation for the purpose of gathering or analyzing the 

personally identifiable information of consumers. 

• Can you clarify that the Bureau does not collect data for the purposes of monitoring any 

individual? 

• Does the data that the Bureau collects for market monitoring purposes diO'er from the 

data it reviews under its examination and supervisory authority? Is data gathered for 

mari<et moni10riing purposes stripped of personally identifiable information before it is 

studied by the Bureau? 

• Is it true that the private entities from whom the Bureau collects anonymized data have 

access to millions of Americans' personally identifiable infom1ation, and that those 

entities offer that infom1ation for sale to other private businesses? 

• Does the data that the Bureau reviews in supervision and examination differ from the data 

that the prudential banking regulators review during their supervision and examinations? 
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Nomi11ulions Heuring 

July 19, 2018 

• What evidence exists that shows that the CFPB or third parties have mishandled such 

personal data? Please provide copies of any analysis that shows that the CFPB or these 

third parties have mishandled any personal data. 

Response: The information you request to the above questions is information that is not 

available to me. As I discussed in my testimony, one of the four priorities I would establish 

at the Bureau is reviewing and improving data collection practices. The Bureau must 

recognize its profound duty to the American people to protect the data in its possession. 

Under m)' leadership, the Bureau would limit data collection only to what is required 

under law and is necessary to carry out its mission and ensure that that data is protected. 

The issue clearly needs more attention because consumers are unaware of the 

''ulnerabilities they face and unsure of what steps to take to protect themselves. 

In early Detember 2017, the CFPB withdrew its request to OMS to conduct an online survey of 

8,000 individuals related to debt collection disclosures. This survey would have provided 

important data about debt collection disclosures to assist the CFPB's obligations to root out 

unfair, decepti1•e, and abusive acts and practices related to debt collettion. 

• Why did the CFPB withdraw this survey? 

• Did you or Mr. Mulvaney personally appro1•e this decision? 

• How do you reconcile this decision to deprive the CFPB of important data with your 

previous statements about your intention to engage in morecost·benefit analysis based on 

quantitative data? 

• Did the CFPB undertake any cost·benefit analysis in con nett ion with this decision? If so, 

please provide a copy of that analysis to the Committee. 

Response: The information you request about an online debt collection survey is 

information that is n()t available to me. I did not personally appro1•e the decision and have 

no information regarding how the decision was made to support a more specific response to 

)'OUr third question above. Under my leadership, the Bureau would limit data collection to 

only what is required under law and is necessary to carr)' out its mission and ensure that 

the Bureau protects that data. As noted in my testimony and other responses to questions 

for the record, limiting data collection in the manner I hal'e pledged is consistent with 

supporting robust use of cost-benefit anal)"sis and a commitment to data·driven decision· 

making. To the extent that the data is supporting decision·making, the data collection 

would be needed and required. 
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Nomi11ulions Heuring 

July 19,2018 

At a hearing, Mr. Mulvaney said that he immediately issued a data collection freeze with cenain 

accommodations made for enforcement data and that CFPB is now looking at some data oflsile 

instead of s10ring it onsite. 

• Did the Bureau perform a cost-benefit analysis prior to a decision to hail collection of 

cenain data ancl instead view it oflsite? If so, please pr01•ide that analysis. 

• What, if any, in formation did the Bureau previously collect that it does not collect now? 

• What, if any, in formation did the Bureau previously collect that it does not collect or 

view ofTsile now? 

Response: The information )'OU request is information that is not available to me. As I 

noted above, one of the four priorities I would establish at the Bureau is re~ ewing and 

improving data collection practices. The Bureau must recognize its profound duty to the 

American people to protect the data in its possession. Under my leadership, the Bureau 

would limit data collection only to what is required under law and is necessary to carry out 

its mission and ensure that that data is protected. The issue clearly needs more attention 

because consumers are unaware of the vulnerabilities they face and unsure of what steps to 

take to protect themselves. 

At a hearing, Mr. Mulvaney said that he has been able to document 240 lapses in data security 

and that he suspects but has not been able to con finn 800 others. Are the 240 lapses in data 

security that he described 240 separate pieces of infonnation or 240 instances in which muiliple 

data lapses occurred? Please describe the nature of these lapses and how many of these lapses 

contained personally identifiable information (PII). 

• Does the Bureau monitor the accounts of panic.ular consumers or track the financial 

habils or ac.tivities of any individual consumer? If so, in 1111at cases? 

• In response to questions about data security at the Bureau, Mr. Mulvaney said, "the mle 

is this, I'm not going to hold somebody to a higher standard than we're willing to hold 

ourselves." Will you assure us that the Bureau also will hold any company that holds 

consumers' data to the same standard that Mr. Mulvaney holds the Bureau? 

• How has the data collection freeze affected the CFPB's supervisory and examination 

efl'ons? Please provide statistics on the following: 

• The mean and median time to complete an examination 01•er (i) the six months before 

you implemented the data freeze and (ii) the period beginning when you implemented the 

data freeze and endingAprill9, 2018. 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

• The mean and median cost per examination over (i) the six months before you 

implemented th.e data freeze and (ii) the period beginning when you implemented the 

data freeze and endingApril19, 2018. 

Response: The information you request about the Bureau's data collection and supervision 

and enforcement activity is information that is not a1•ailable to me. Such information 

would enable a more specific answer to the second question above. As I have previously 

noted, two of the four priorities I would establish at the Bureau are taking aggressive 

action against bad actors who break the rules and protecting sensitil"e information in the 

Bureau's possession. Under my stewardship, the Bureau will take aggressive action against 

bad actors who break the rules by engaging in fraud and other illegal activity. In addition, 

the Bureau must recognize its profound duty to the American people to protect the data in 

its possession. Under my leadership, the Bureau would limit data collection to only what is 

required under law and is necessar)' to carr)' out its mission and ensure that that data is 

protected. The issue of data collection and securit)" clear I)' needs more attention because 

consumers are unaware of the vulnerabilities they face and unsure of what steps to take to 

protect themselves. 

The Administration submitted a legislative package of major changes to rents for millions of 

families. This seems premature when HUD has not implemented all of the widely-supported 

streamlining measures that Congress already passed as part of the Housing Opportunity Til rough 

Modemization Act (HOTMA) in 2016. 

• Can you please provide, for each provision of HOTMA, a table including the following 

infonnation: 

• Section and Subsection#; 

• Topic; 

• Implementation Status; 

• Implementing document/s and any related guidance; and, if not implemented: 

Response: As the question concerns implementation of HUO programs and policies on 

which the SecretarJ' of HUO has responded to the Committee, this question is best directed 

toHUO. 

• whether OMB is currently reviewing a Notice or Rule to implement the provision; and 

• the estimated date of implementation. 
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Committee on Banking, Housing, and Urban Affairs 

Nomi11utions Heuring 

July 19, 2018 

Response: The Office of Management and Budget has an extensive role in supporting 

agencies as they implement the President's priorities and agenda, which includes re1•iewing 

legislative proposals, regulatory proposals, notices/reports and the availability of budgetary 

resources. I can note that HUD has published Federal Register Notices (FRNs) that 

implemented various components of HOH·IA. Consistent with OMB's role, the following 

FRNs went through OMB clearance: 81 FR 73030 (10124116), 82 FR 5458 (1118117), 82 FR 

32461 (7114/17), and 83 FR 35490 (7/26/18). 

Enforcement of Hardship Pm·isious 

One provision of the HOTMA legislation in 2016 was a direction that HUD certify that current 

hardship protections for residents are being enforced. 

• When will HUD complete this task? 

Response: As the question concerns implementation of HUO programs and policies on 

which the Secretar)' of HUO has responded to the Committee, this question is best directed 

toHUD. 

• What has HUD done to date toward this requirement? 

Response: As the question concerns implementation of HUD programs and policies on 

which the Secretar)' of HUD has responded to the Committee, this question is best directed 

toHUO. 

• What is HUO doing to ensure that residents are aware of the current hardship 

protections? 

Response: As the question concerns implementation of HUD programs and policies on 

which the Secretar)' of HUD has responded to the Committee, this question is best directed 

toHUD. 

• Has OMB reviewed this HUD cenification? 

Response: I have no personal knowledge of this certification, but in the normal course of 

its work, Oi\18 staff would review such documents. 

Families Affected by fl1creused Mandatory Minimum Re11ts 

In response to my question about the typical income of families affected by proposed changes in 

mandatory minimum rents, Dr. Car.;on testified that the typical family had an incomeof$9,870. 

The infonnation I hal'e indicates that most of the families afiected by this change hal'e incomes 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11utions Heuring 

July 19,2018 

below $7,000 per year, with many far below this amount. I also understand that the median 

income of a family affected by the proposed increase in minimum rent is $2,400. 

• What is the median annual income of a family whose rent would increase by virtue of 

HUD's new mandatory minimum rent proposal? 

Response: As the question concerns implementation of HUD programs and policies on 

which the Secretary of HUD has responded to the Committee, this question is best directed 

toHUD. 

Child Cure Deductio11 

In discussion with Senator Scott, Secretary Carson mentioned the importance of daycare 

availability to parents who are trying to make progress on their self-sufficiency goals. I agn.>e 

with the Secretary that the availability of afiordable childcare is a critical component of parents' 

ability to work and pursue education and training opportunities. 

• Yet, the Administration's proposal eliminates the child care deduction for calculating rent 

that helps families to afford child care. Do you believe that making it more difficult for 

familie.s to afford child care will help them achie1·e self-sufficiency? 

Response: As the question concerns implementation of HUD programs and policies on 

which the Secretar)• of HUD has responded to the Committee, this question is best directed 

toHUD. 

Self-Sufficiency Outcome Mo11itoring 

Dr. Carson stated that he views success in the realm of self-sufficiency as families receiving 

HUD assistance no longer n.>eeiving HUD-assistance for positive reasons. 

• How does the Administration now, or how doe.s the Administration plan to, measure and 

track outcome data for families? 

Response: As the question concerns implementation of HUD programs and policies on 

which the Secretar)' of HUD has responded to the Committee, this question is best directed 

toHUD. 

• Do HUD's tenant characteristics reporting systems currently contain data fields to 

capture the reasons why assisted families leave HUD assistance? 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

Response: As the question concerns implementation of HUD programs and policies on 

which the Secretary of HUO has responded to the Committee, this question is best directed 

toHUO. 

• If not, do you plan to recommend that HUD build or enhance this tracking capability in 

its data systems? 

Response: As the question concerns implementation of HUO programs and policies on 

which the Secretar)' of HUO has responded to the Committee, this question is best directed 

to HUD. Should HUD make such a recommendation, OMB would in the normal course 

work with HUD to implement it. 

HUD Inspection Protocols 

During his testimony, Secretary Carson mentioned that HUD has had to "get rid of dozens of 

(housing) inspectors w~o have consistently been providing inappropriate scoring." He also 

indicated that the elimination of corruption resulted in the temtination of dozens of inspectors. 

• Please describe in detail the number of inspectors im•olved and the circumstances that led 

to their removal. Has the Department replaced them? Do you know ifHUD has made 

referrals to the Department of Justice or other appropriate law enforcement agencies? 

Response: This particular issue has not been raised to my attention, so I have no personal 

knowledge of the issue. As the question concerns implementation of H UD programs and 

policies on which the Secretary of HUD has responded to the Committee, this question is 

best directed to HUD. 

• What steps has the Administration taken to improve the integrity, consistency, and 

quality of HUD inspections of assisted properties? 

Response: As the question concerns implementation of HUO programs and policies on 

which the Secretary of HUO has responded to the Committee, this question is best directed 

toHUD. 

• Have you reviewed any HUD policy or activities to improve oversight of the quality of 

HUD·assisted housing? 

Response: I ha,·e no r~collection of personally reviewing such policies or activities, but my 

staff may have. The Office of Management and Budget (OMB) has an extensive role in 

supporting agencies as they implement the President's priorities and agenda, which 

includes reviewing legislative proposals, regulatory proposals, notices/reports and the 

12 
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71918213.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19,2018 

availability of budgetary resources. In addition, OMB continually seeks to improve the 

quality, efficiency, and effectiveness of Federal programs, including strengthening 

oversight of the quality of HUD-assisted housing. 

Opport11nity Zones 

Secretary Carson memioned that he expects Opportunity Zones to unleash "in excess ofS2 

trillion." 

• Pie~ provide the analysis behind the Administration's claim for this amount of activity. 

Response: As the question concerns a statement b)' the Secretary on which the Secretary 

has responded to the Committee, this question is best directed to HUD. 

• What is the progress to date? 

Response: On June 14th, Treasury and the Internal Revenue Service announced the final 

round of Opportunity Zone designations. Treasury and the IRS also recently released 

Frequently Asked Questions to provide additional information on this new tax incentive. 

• Would all communities that currently benefit From Community De1•elopment Block 

Grant (CDBG) Funds benefit From Opportunity Zones? If not, how many fewer 

communities would receive Funding if we were to rely on Opportunity Zones with no 

supplemental CDBG funding? 

Response: It is unlikely that all communities that currently receive CDBG funds are 

included in Opportunity Zone designations. Such a complete comparison would be 

difficult to do giren the limited nature ofCDBG reporting at thefederalle,·el, though I 

understand that HUO is looking at conducting such an analysis per Secretary Carson's 

response to the Committee. 

Sectio11 3 lmplementutioll 

• Section 3 provides important training and wori< opportunities For residents of HUDassisted housing and surrounding communities. Secretary Carson stated in our hearing 

that HUD plans to enhance Section 3. How does the Administration plan to enhance 

Section 3, and when would the Administration implement these enhancements? 

Response: As the question concerns implementation of HUD programs and policies on 

which the Secretar)' of HUO has responded to the Committee, this question is best directed 

toHUO. 

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71918214.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

Lead-Basetf Paint Screening 

In discussion with Senator Donnelly, Secretary Carson mentioned that he would like to see 

universal screening for lead-based paint due to the pervasiveness of le~d based paint hazards in 

older homes. The Med ic~id program currently has screening requirements for young children, 

but the uptake is not wbat we'd like to see. 

• Is the Administration considering implementing such a universal screening requirement? 

Response: This particular issue has not been raised to my attention, so I have no personal 

knowledge of the issue. As the question concerns HUD's coordination with HHS which the 

Secretary of HUD has raised to the Committee, this question is best directed to HUO. 

• What role can HUD and its programs play in promoting and enhancing screening? Are 

there additional programs under your purview at OMB that could also play a role in 

promoting universal screening? 

Response: As noted above, this particular issue has not been raised to m)' attention, so I 

have no personal knowledge of the issue. As the question concerns implementation of HUD 

programs and policies on which the Secretary of HUD has responded to the Committee, 

this question is best directed to H UD. 

HUD Response to the Opioid Crisis 

• Please describe in detail what HUD is doing to respond to the opioid crisis, including the 

amount of funding and FTEs dedicated to the problem. 

Response: As the question concerns implementation of HUD programs and policies on 

which the Secretary of HUO has responded to the Committee, this question is best directed 

toHUD. 

Fair Housi11g 

April marked the 50th Anniversary of the Fair Housing Act. That landmark bill made housing 

discrimination and redlining illegal, but we have more work to do to achieve the goals of that act. 

That's why i1was disappointing to hear thai HUD is 1hinking about changing its mission 

statemenlto diminish the importance of combating housing discrimination. 

• Have you been involved in any discussion of changing the HUD mission statement? 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19,2018 

Response: No, I have not been invoh•ed in any such discussions. 

The Administration's actions over the past year, have made me and others question the 

Administration's commitment to fair housing. For example: 

In spring 2017, HUD withdrew and has failed to reissue guidance requiring equal treatment of 

tra11sgender people, who sutler disproportionately higher rates ofhomelessness, in HUD· 

supported homeless shelters. 

In October 2017, the Treasury Department issued an insurance regulation report recommending 

that HUD "reconsider the use of the disparate impact rule," as it applies to insurance. Treasury's 

recommendation argues against long-standing practice and sides with arguments made by the 

insurance industry in liligation against HUD and the federal govemment. 

ln January 2018, HUD suspended its Anlnnatively Furthering Fair Housing (AFFH) rule 

through October 2020. The AFFH mle, was developed afier a two-year public comment period 

and responded to the General Accountability Onlce's 2010 recommendations for improvements 

in the previous process. It was meant to finally fulfill the Fair Housing Act's 50-year-old 

requirement that HUD ~nd its grantees "Anlnnatively Further" fair housing in their 

communities. Althougll HUD subsequently reinstated the submissions under the Rule in the face 

of litigation, it has now wi hdra11~1 the AFFH Local Government Assessment Tool intended to 

help communities carry out their Assessments of Fair Housing. 

Taken together, these actions undennine confidence in the Administration's commitment to fair 

housing and inclusive communities. 

• I understand that, of the 49 initial Assessment of Fair Housing (AFH) submissions, 41 

were accepted by HUDon either the initial submission or subsequent resubmission, and 

that the remaining 8 were under review at the time of the suspension notice. Is that 

correct? If not, pkase provide the number of AFH submissions, the number of AFH 

submissions accepted on initial submission or subsequent submission, and the number of 

AFH submissions under re1•iew at that time. 

Response: As the question concerns implementation of HUO programs and policies on 

which the Secretar)' of HUO has responded to the Committee, this question is best directed 

toHUO. 

• In the January 2018 suspension notice, HUD stated "that program participants need 

additional time and technical assistance to adjust to the new AFFH process and complete 

AFH submissions that can be accepted by HUD." What training and technical assistance 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19,2018 

plans has HUD implemented since the suspension to help communities prepare to 

administer the AFFH rule? 

Response: As the question concerns implementation of HUO programs and policies on 

which the Secretar)' of HUO has responded to the Committee, this question is best directed 

toHUD. 

• !understand that many community requests for technical assistance to prepare for the 

AFFH rule were not granted in a timely fashion. What steps has HUD taken to ensure 

that its technical assistance is provided in suOicient time to allow communities to prepare 

their AFHs? Does HUD intend to continue to work with outside organizations to provide 

training and technical assistance to local partners throughout the AFH process? 

Response: As the question concerns implementation of HUD programs and policies on 

which the Secretary of HUO has responded to the Committee, this question is best directed 

toHUD. 

• Following the S\lspension of the AFFH rule, HUD is pem1itting its grantees to continue 

submitting the previous Analysis of Impediments (AI), despite the weaknesses in the AI 

process cited in the 2010 GAO study. On March 6, 2018, over 140 organizations 

submitted a letter to HUD's General Counsel opposing the del a)' of the AFFH process, 

stating that by imposing the delay "HUD is abrogating its duty to carry out the mission 

Congress assigned it 50 years ago through the Fair Housing Act." How do you plan to 

ensure that HU[) and its grantees fulfill their obligations to aOinnatively further fair 

housing during the suspension of the AFFH rule, gi1•en the weaknesses cited by the GAO 

in the A I process? 

Response: As the question concerns implementation of HUO programs and policies on 

which the Secretar)' of HUO has responded to the Committee, this question is best directed 

toHUD. 

• At the time of the suspension notice, a number of communities had already begun to 

develop an AFH under the AFFH nde. Will HUD support the development of their 

AFHs with technical assistance and guidance on plans which will be completed prior to 

October 2020? 

Response: As the question concerns implementation ofHUD programs and policies on 

which the Secretar)' of HUD has responded to the Committee, this question is best directed 

toHUD. 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

• Secretary Carson cited concem about communities' cost of compliance with the new rule. 

Has the Admini strmion analyzed the cost of housing opponunities denied to people in 

protected classes if communities are f.1iling to fulfil their obligations to affirmatively 

funher fair housing? Does the Administration have an estimate of those costs, and if so 

can you provide it along with the underlying methodology? 

Response: In light of the confidentiality interests that attach to executive branch decisionmaking, I am unable to answer this question. 

• Were you involved in the production or OMB clearance of the October2017 Treasury 

repon on the insurance industry regulation? 

Response: The Office of Management and Budget (OMB) has an extensive role in 

supporting agencies as they implement the Pmident's priorities and agenda, which 

includes m·iewing legislative proposals, regulatory proposals, certain notices/reports and 

the availability of budgetary resources. Consistent with that role, OM B was a part of an 

interagency clearance process that pro1•ided input into the above referenced October 2017 

Treasury report on the insurance industry regulation to ensure that it was consistent with 

Administration policies and priorities. 

• Do you agree with the Treasury report's recommendation that HUD '·reconsider the use 

of the disparate impactmle," as it applies to insurance? 

Response: As referenced in the answer above, O~IB participated in the clearance process, 

as did HUD. I have not talked with officials at HUD regarding the status of this issue, 

which would be necessary to address this question. 

Fair Housi11g btvestigtJtiOIIS 

Public documents and press releases available on HUD's website show that HUD has brought 

charges in 47 cases under the Fair Housing Act in fiscal years 2016,2017, and 2018. Of these 

cases, 43 were charged prior to your confirmation; only four have been charged since you arrived 

at HUD. Publicly available documents and press releases show that48 cases have been resolved 

in these same fiscal years; only nine resolutions have taken place since your arrival at HUD. 

This extreme decline in action under the Fair Housing Act is extremely conceming, particularly 

in light of a recent New York Times report that HUD's Office of Fair Housing and Equal 

Opportunity (OFHEO) has delayed or terminated a number of investigations under the Fair 

Housing Act over the past year. The alleged violations that HUD is no longer investigating 

included failure to properly constmct units to accommodate individuals with disabilities, citing 

restrictions that prohibited the construction of group homes, and marketing tactics explicitly 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

targeting housing-related advertisemems based on race, ethnicity, or other protected classes 

under the Fair Housing Act. 

• What factors caused the decline in Fair Housing Act cases charged and resolved 01•er the 

past 13 months? Do you expect the number of cases charged or resolved to increase or 

decline in the coming months? 

Response: I hal'e no ()mona! knowledge of these issues. As the question concerns 

implementation of HUD programs and policies on which the Secretary of HUD has 

responded to the Committee, this question is best directed to HUD. 

• Are you aware of whether any HUD employee ordered a pause, hold, or termination of 

any investigation into potential Fair Housing Act violations since the Secretary's 

confim1ation on March 2, 2017? If so, who directed the delay or termination of those 

cases? 

Response: I ha1·e no ()ersonal knowledge of these issues. As the question concerns 

implementation of HUD programs and policies on which the Secretary of HUD has 

responded to the Committee, this question is best directed to HUD. 

• Are you aware of whether any HUD employee ordered a pause, hold, or termination of 

any investigation into potential Fair Housing Act violations by advertisers on Facebook 

since the Secretary's confimtation on March 2, 2017? If so, who directed the delay or 

temtination oftihat case, and on what grounds? 

Response: I ha1·e no ()ersonal knowledge of these issues. As the question concerns 

implementation of HUD programs and policies on which the Secretary of HUD has 

responded to the Committee, this question is best directed to HUD. 

• Are you aware of whether any senior HUD oflicials outside ofOFHEO have been 

involved in decisions to pursue or resolve cases under the Fair Housing Act since the 

Secretary's conflnnation? If so, which oflicials have been involved and in what capacity? 

Response: I hal'e no ()ersonal knowledge of these issues. As the question concerns 

implementation of HUD programs and policirs on which the Secretary of HUD has 

responded to the Committee, this qurstion is best directed to HUD. 

• Please provide an updated list of all Fair Housing Act cases charged and resolved in 

fiscal years 2016, 2017, and 20 18 to date. 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

Response: I hal'e no personal knowledge of these issues. As the question concerns 

implementation of HUD programs and policies on which the Secretary of HUD has 

responded to the Committee, this question is best directed to HUD. 

Office of Fair Housi11g and Equal Opportunity Staf!i11g 

• In addition to numerous repons of abandoning fair housing priorities, there are 

indications that senior career HUD officials invo!l•ed in imponant fair housing initiatives 

are being reassigned. In order to better understand how fair housing programs may be 

impacted by changes in personnel assignments, please identify each official at the GS-13 

le1•el or above, or who is in a career Senior Executive Service position, in the Office of 

Fair Housing and Equal Opponunity, including Regional Office officials, whose 

reponing line, job title, or work responsibilities have been changed either fom1ally, or 

infonnally, in the period between March 2, 2017, and March 30, 2018, or that is under 

consideration to be changed in the future. 

Response: I hal'e no personal knowledge of these issues. As the question concerns 

implementation of HUD programs and policies on which the Secretary of HUD has 

responded to the Committee, this question is best directed to HUD. 

• For each oflicial identified above, please provide the name, job title, and experience of 

the individual who is, or is e.xpected to be, the successor in that position or depanment. 

Response: I ha"e no personal knowledge of these issues. As the question concerns 

implementation of HUD programs and policies on which the Secretary of HUD has 

responded to the Committee, this question is best directed to HUD. 

Equal Access Guitlancefor HUD-Assisted Sltelters 

Senator Conez Masto asked Secretary Carson about the status of four publications HUD 

removed from its website in spring 2017. These public<ttions had been developed in consultation 

with organizations dire<:tly sen•ing individuals experiencing homelessness, and were geared to 

assist HUD-funded shelter programs in complying with the Depanment's nondiscrimination 

regulations. 

• Given that current HUD regulations were developed through multiple public comment 

periods, and the publications removed from HUD's website were de1'eloped in 

consultation with direct service provider.;, and appear to reflect widely accepted best 

practices in the field, do you know what changed circumstances, if any, led to the 

Depanment removing or possibly changing these documents? 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulious Heuring 

July 19, 2018 

Response: I have no personal knowledge of these issues. As the question concerns 

implementation of HUD programs and policies on which the Secretary of HUD has 

responded to the Committee, this question is best directed to HUD. 

• When do you anticipate these resources being restored to HUD's website? 

Response: I have no personal knowledge of these issues. As the question concerns 

implementation of HUD programs and policies on which the Secretary of HUD has 

responded to the Committee, this question is best directed to HUD. 

Persoullellssues 

• Please provide resumes for all non· Senate-confirmed Schedule C and Non·Career Senior 

Executive Service employees who were employed at HUD as of March 16, 2018. 

Response: The information you request is not information typically available to me. As the 

Secretary of HUD has responded to the Committee, this question is best directed to HUD. 

• Please provide a resume for Mr. Johnson Joy. 

Response: The information you request is not information typically available to me. As the 

Secretary of HUD has responded to the Committee, this question is best directed to HUD. 

• Please provide a copy of HUD's contract(s) with the Accel Corporation in force since 

January20, 2017, and those of any of its subcontractors. 

Response: The information you request is not information typically available to me. As the 

Secretary of HUD has responded to the Committee, this question is best directed to HUD. 

• Is HUD required to approve subcontractors? If so, why did it do so in these instance.s? 

What are the additional costs added by two layers of contractors? 

Response: The information you request is not information l)•pically available to me. As the 

Secretary of HUD has re.spondcd to the Committee, this question is best directed to HUD. 

• Please provide an accounting oft he spending under these contracts. 

Response: The information you request is not information f)·pically available to me. As the 

Secretary of HUD has responded to the Committee, this question is best directed to HUD. 

20 
104 


71918221.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11utions Heuring 

July 19,2018 

• Please provide a list of employees who worked at HUD under these contracts, a copy of 

their resumes, their job tilles, salaries, duties, and how those duties supponed the purpose 

of the contract 

Response: The information you request is not information typically available to me. As the 

Secretary of HUO has responded to the Committee, this question is best directed to HUO. 

• Please describe the system for ensuring that contract employees, such as those at Accel, 

actually worked the days and hours for which they claimed reimbursement. 

Response: The information you request is not information t)•pically available to me. As the 

Secretary of HUO has responded to the Committee, this question is best directed to HUO. 

• HUD's spokesman, Rafli Williams, indicated that Mr. Naved Jafry was hired by Accel. 

The O\\Uer of Accel denied she hired him. Please describe in detail how Mr. Jafry was 

brought to HUD and what he did while there - what company he worked for, under what 

contract, who authorized his hiring, what he was paid, and what work he produced. 

Response: The information you request is not information f)'pically available to me. As the 

Secretary of HUO has responded to the Committee, this question is best directed to HUO. 

• Ms. Katrina Hubbard alleges that she complained about the mismanagement in the CIO's 

of1ice on January 8 of this year and was fired soon thereafter. Are you aware whether 

anyone in HUD's senior management was aware of her complaints prior to March 20, 

and if so, when did they become aware and how did they respond? 

Response: The information you request is not information t)•pically available to me. As the 

Secretary of HUO has responded to the Committee, this question is best directed to HUO. 

• Has HUD initiated an inquiry into her allegations? 

Response: The information you request is not information t)•pically available to me. As the 

Secretary of HUO has responded to the Committee, this question is best directed to HUO. 

• If so, what has HUD found? If not, why not? 

Response: The information you request is not information typically available to me. As the 

Secretary of HUO has responded to the Committee, this question is best directed to HUO. 

Rental Assisla11ce Demonstration (RAD) 

21 
105 


71918222.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19,2018 

Last fall, the National Housing Law Project sent Secretary Carson a letter describing the many 

challenges that they have experienced with the implementation of the Rental Assistance 

Demonstration {RAD) program nationwide. These concerns include experiences with residents 

who have been illegally rescreened and evicted from their homes becauseofthe RAD 

conversion, improperly relocated to homes that don't accommodate their family size or their 

disability needs, discrimination against families and residents with disabilities, and concerns 

about the strength of the protections to ensure the long-tenn affordability of these important 

homes. 

In a recent report {GAO-IS-123), the General Accountability Ofiice (GAO) noted that HUD has 

not systematically analyzed household-level data on the effects ofRAD conversion on residents. 

As stated by GAO, "Without a comprehensive re1•iew of household infonnation ... HUD cannot 

reasonably assess the eJTects of ongoing and completed RAD conversions on residents and 

compliance with resident safeguards ... " 

• What steps has HUD taken to proactil'ely ensure that required resident protections are 

carried out? 

Response: I hal'e no ()mona! knowledge of these issues. As the question concerns 

implementation of HUD programs and policies on which the Secretary of HUD has 

responded to the Committee, this question is best directed to HUD. 

• What steps has HUD taken to ensure that HUD has sufiicient staffing and data resources 

to monitor and enforce resident protections? 

Response: I hal'e no ()ersonal knowledge of these issues. As the question concerns 

implementation of HUD programs and policies on which the Secretary of HUD has 

responded to the Committee, this question is best directed to HUD. 

Mot•i11g to Work Expa11sion 

The FY 2016 Consolidated Appropriations Act authorized the expansion of the MTW 

Demonstration to an additional I 00 agencies and required the rigorous e1•aluation of 

demonstration outcomes. 

• What steps has H UD taken or does HUD plan to undertake to ensure that HUD will have 

sufficient staft'to ove~ee the expanded demonstration? 

Response: I have no ()ersonal knowledge of these issues. As the question concerns 

implementation of HUD programs and policies on which the Secretary of HUD has 

responded to the Committee, this question is best directed to HUD. 

22 
106 


71918223.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

• With regard to HUD's evalua1ion of lite expanded demonstration, please provide an 

overview of HUD's evaluation plan and expected timeline for initiation and conduct of 

the evaluation. 

Response: I ha,·e no personal knowledge of these issues. As the question concerns 

implementation of HUD programs and policies on which the Secretary of HUD has 

responded to the Committee, this question is best directed to HUD. 

23 
107 

RESPONSES TO WRITTEN QUESTIONS OF SENATOR ROUNDS 

FROM KATHLEEN LAURA KRANINGER 


71918224.eps
108 

RESPONSES TO WRITTEN QUESTIONS OF SENATOR 

MENENDEZ FROM KATHLEEN LAURA KRANINGER 


71918225.eps
109 


71918226.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19,2018 

• Will you commit that if confimted, you will use the full extent of the CFPB's 

enforcement alllhority to protect consumers? 

Response: I am firmly committed to fulfilling the Bureau's congressional mandate in 

accordance with the Dodd-Frank Act. While I will not prejudge and cannot predict eYer)' 

decision that will come before me, under m)' stewardship, the Bureau will take aggressi1•e 

action against bad actors who break the rules by engaging in fraud and other illegal 

actil•ity. I also beliel'e the Bureau should work closely with other federal financial 

regulators and the relel'ant state agencies on superYision and enforcement. 

Earlier this ye~ , Mr. Mulvaney stripped the Office of Fair Lending and Equal Opportunity 

(OFLEO) of its enforcement and supervisory role. Removing enforcement authorit)' from 

OFLEO, which was created to combat predatory mortgage lending practices, seriously impedes 

the CfPB from meeting its statutory mandate to "provide oversight and enforcement of federal 

laws intended to ensure the fair, equitable, and nondiscriminatory access to credit for both 

individuals and conununities that are enforced by the Bureau."! 

• Will you commit to restoring OFLEO's enforcement and supervisory authority? Yes or 

no. 

Response: As I discussed in my testimony, enforcing the fair lending laws is a critical 

responsibility of the Bureau, regardless of organizational structure. I can commit to 

approaching the organizational structure with an open mind. It would be inappropriate 

and premature to make any staffing or organizational decisions prior to confirmation and 

the opportunil)• to mC<Ct with staff. 

• If not, please explain to me your justification for keeping in place these changes, and 

please provide a thorough explanation of how this change will impact the CFPB's 

statutO!')' mandate to provide oversig)lt and enforcement of fair lending Jaws? 

In June, Mr. Mulvaney disbanded the statutorily-required Consumer Ad1•isory Board (CAB), 

which advises and infonms the CFPB of emerging threats in the consumer financial marketplace. 

• Will you commit to immediately reassembling the CAB? 

Response: Should I be confirmed, I look fomard to engaging with a broad range of 

external stakeholders, including the Bureau's ad1•isor)' committees. While I recognize the 

importance ofha1·ing many avenues for stakeholder engagement, I am com milled to 

carrying out the Bureau's statutory requirements for engagement, including through the 

Consumer Advisory Board. 

1 !2 u.s.c. § 549J(c](2)(A). 

48 
110 


71918227.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

• Will you allow its current members to finish their tenns? 

Response: If confirmed, I look fomard to reviewing this issue with staff. 

Mr. Mulvaney delayed the prepaid c.1.rd and account rule until April 2019. 

• Do you intend to implement the prepaid rule on schedule? 

Response: I am committed to data-dri1•en decision-making. Under my leadership, that 

would be a focal point at the Bureau. I will not prejudge and cannot predict every decision 

that will come before me at the Bureau, including an)' potential rulemaking activities. 

• Do you have any plans to reconsider the rule? 

Response: I am committed to data-dril·en decision-making. Under my leadership, that 

would be a focal point at the Bureau. I will not prejudge and cannot predict every decision 

that will come before me at the Bureau, including any potential rulemaking activities. 

After Equifax failed to protect the data over more than 145 million Americans, fonner CFPB 

Director Cordray immediately authorized an investigation into the data breach. In response to 

a Janning reports that Mr. Mulvaney "pulled back from a full-scale probe," Mr. Mulvaney 

claimed "there has been no change in the position from the previous leadership of the CFPB 

regarding Equifax." 

Should you be confimted, do you intend to place the full weight of the director's 

authority in support of the Equifax investigation, allow the investigation to reach a 

natural conclusion, and publicize any findings, recommendations, and enforcement 

actions stemming from the in1•estigation? 

Response: As you know, the Equifax investigation is ongoing. If confirmed, I will re,•iew 

and take appropriate action on this matter consistent with the Bureau's statutory 

authorities and supen•isory, investigatil'e and enforcement policies and practices and in 

coordination with the Federal Trade Commission. 

In a 2017 report on serving limited English proficiency (LEP) consumers, the CFPB found that 

"consumers who are Limited English Proficient (LEP) often encounter significant barriers to 

participating in the con~umer financial marketplace, including completing key financial 

documents, managing bank accounts, resolving problems with financial products, and accessing 

financial education." 

49 
111 


71918228.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

• What initiatives will you support and/or launch to ensure LEP consumers have the 

necessary information in the language of their preference, thereby enabling them to make 

well-infonned financial decisions? 

Response: If confirmed, I am committed to carr)·ing out the Bureau's statutory mission on 

behalf of all consumers. I look fomard to learning more about the Bureau's efforts in the 

LEP area. 

In May 2018, Mulvaney announced plans to reassign the staff that work for the Student Loan 

Ombudsman and disband the Office for Students and Young Consumers, who oversee abuses in 

the student lending industry. At a time when Americans have Sl.5 trillion in student loan debt, 

the CFPB should not be gutting oversight of the student lending industry. 

If you are confirmed, will you reassign staO'back to the Student Loan Ombudsman and 

reassemble the Oflice for Students and Young Consumers? 

Response: Student lending is a significant issue for many Americans and one that I will 

examine closely, if confirmed. I will rel'iew the structure of the organization with an open 

mind. 

Mortgage delinquency rntes surged in Puerto Rico after Hurricane Maria, and we are hearing 

reports that mortgage servicers are using the same dirty and illegal tricks they used in New 

Jersey and all across the country in the afiennath of the foreclosure crisis- they are dual tracking 

foreclosures and loss mitigation, they're promising Joan modifications but never following up 

with borrowers. llte C FPB's engagement with mortgage servicers is critical at this juncture. 

• What will you do as CFPB director to conduct monitoring and oversight to ensure 

mortgage servicers are meeting their obligations to borrowers that fell behind on their 

mortgages afier Hurricane Maria? 

Response: If conlirm~d, I am committed to fulfilling the Bureau's statutory mission. Close 

coordination with other federal regulators, such as the Federal Housing Finance 

Administration in this ca.se, and state and local regulators is also important for effectil·e 

monitoring and oversight. 

• Will you commit to taking action in instances \\1tere servicers are failing to uphold their 

legal responsibilities to borrowers? 

Response: While I will not prejudge and cannot predict every decision that will come 

before me at the Bureau, under my stewardship, the Bureau will take aggressive action 

against bad actors who break the rule$ by engaging in fraud and other illegal activity. 

so 
112 


71918229.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

I submitted questions for the record to HUD Secretary Carson following a Senate Banking 

Committee hearing on March 22,2018. I still ha1•e not received any responses. 

• Please explain OMB's role in fommlating, editing, reviewing, or approving questions for 

the record sent to HUD. 

Response: The Office of Management and Budget reviews mponses to Questions for the 

Record before they are sub milled to Congress. 

• Will you commit to providing OMB clearance and transmitting HUD's responses to the 

Senate Banking Committee prior to the Committee's vote on your nomination? 

Response: HUD's res!llonses were transmitted on Tuesday, Jul)' 26'1

• 

51 
113 

RESPONSES TO WRITTEN QUESTIONS OF SENATOR WARREN 

FROM KATHLEEN LAURA KRANINGER 


71918230.eps
114 


71918231.eps

Commiltee on Banking, Housing, and Urban Affairs 

Nominations Heuring 

July 19,2018 

• Dodd-Frank Act Section 1035(c) establishes the functions of the student loan 

ombudsman and slates that the ombudsman shall resolve complaints "in collaboration 

with the Department of Education and with institutions of higher education, lenders, 

guaranty agencies, loan servicers, and 01her participants in private education loan 

programs". Dodd-Frank Act Section 1035(c) also requires the ombudsman to establish a 

memorandum of understanding with the Department of Education's student loan 

ombudsman "to ensure coordination in providing assistance to and serving borrowers 

seeking to resolve complaints related to their private education or Federal student 

loans."3 Will you insist that the U.S. Department of Education maintain a memorandum 

of understanding between its own ombudsman and the student loan ombudsman at the 

Consumer Financial Protection Bureau, as required by 12 U.S. Code § 5535 "to ensure 

coordination in providing assistance to and serving borrowers seeking to resolve 

complaints related to their private education or Federal student loans" (emphasis added)? 

Response: I am awar-e that Section 1035 contemplates a Memorandum of Understanding 

between the Department and the Bureau, and I will work towards that end. 

• Given the U.S. Department of Education's August2017 decision to tem1inate existing 

memoranda of understanding between the CFPB and the Education Department, if 

confirn1ed, how do you plan to collaborate with the Education Department to resoll•e 

student complaints related to federal student loans? 

Response: As stated in my previous responses, I know that student lending is a significant 

issue for many Americans and one that I will examine closely. I plan to sit down with 

officials at the U.S. Department of Education to talk through what their efforts arc, where 

the Bureau can be helpful, and what role the Bureau currently pla)'s at a more detailed 

level. I am aware that Section 1035 contemplates a ~lemorandum of Understanding 

between the Department and the Bureau, and I will work towards that end. 

• During your continuation hearing, you stated, "It is an essential responsibility of the 

Bureau to engage in the rulemaking activities, setting clear rules'' in response to a 

question regarding the CFPB's role in empowering state attorneys general. On March 12, 

2018, the Department of Education issued and intei]Jretation of the Higher Education Act 

that preempts state regulation of federal student loan sen,icers.4 If con finned, how do 

you plan to work with state attorneys general given the numerous issues of deception and 

predatory actions of federal student loan sen•icers within this context? 

' t2 u.s.c. § 5535 

' hnos:lh\ww.fedcmlregi~tw- go,/documemsl20 I 8/03112120 !8M92~ fC!Ie@l mttmpti n-and <tate·regulatioo11f· 

the-d<panment-of-educations-fedml-sludent-toan 

57 
115 


71918232.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

Response: I am committed to carrJ•ing out the responsibilities of the Bureau under the law, 

which includes working with the U.S. Department of Education. I plan to sit down with 

officials at the U.S. Department of Education to talk through what their efforts are, where 

the Bureau can be helpful, and what role the Bureau currently pla)'s at a more detailed 

level. I recognize that the Bureau designated student loan servicing as a larger participant 

for supervision under its authori!)• in the Dodd·Frank Act. I also believe the Bureau 

should work closely with other federal financial regulators and the relennt state agencies 

on supen·ision and enforcement, including state attorneys general. 

• In May 2018, Acting Director Mulvaney announced his decision to eliminate the CFPB's 

Ofiice for Students and Young Consumers and consolidate its functions into the Ofiice of 

Financial Education. The Oflice for Students and Young Consumers is one of the only 

government entities focused on serving the financial needs of this population and has a 

history of success, securing over $750 million in relief for defrauded student loan 

borrowers and taxpayers. From your perspective, what is the role ofCFPB in sef\•ing this 

population? If con finned, what are your plans forthe Office for Students and Young 

Consumers? 

Response: Student lending is a significant issue for many Americans and one that I will 

examine closely, if confirmed. I will miew the structure of the organization with an open 

mind. I plan to sit down with officials at the U.S. Department of Education to talk through 

what their efforts are, where the Bureau can be helpful, and what role the Bureau 

current!)' pla)'S at a more detailed lel'el. I recognize that the Dodd-Frank Act created the 

position of Private Education Loan Ombudsman and that the Bureau designated for 

supen·ision certain larger participants in the market for student loan sen•icing. 

• Senior leadership at CFPB has told the public that all decisions related to pending 

enforcement actions arc made by or "in consultation with" career staff in the CFPB's 

enforcement division. However, there is a growing concem about the direction of the 

CFPB's current work related to student loans. Can you commit to vigorously pursuing 

and continuinglhe CFPB's existing litigation with the student loan industry? 

Response: While I will not prejudge and cannot predict eYery decision that will come 

before me, under my stewardship, the Bureau will take aggressh·e action against bad actors 

who break the rules by engaging in fraud and other illegal acth•ity. 

The CFPB is governed by several other applicable statutes that make it clear that the agency's 

role is to protect consumers who may be abused by financial products or sef\•ices. Additionally, 

the CFPB's proposed FY 2018-2022 five-year strategic plan states that the CFPB will "address 

needs for inclusion and financial security of sef\•icemembers, older Americans, traditionally 

underserved consumers and communities, and students." Do you believe the CFPB has 

responsibility to protect and infonn students about college debt and bank account agreements 

that pose a risk to them as consumers? 

58 
116 


71918233.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

Response: As noted above, student lending is a significant issue for many Americans and 

one that twill examine closely, if confirmed. That includes working with the Department 

of Education. With respect to this question, financial education is also a critical mission of 

the Bureau and, as su~h, I want to better understand how the Bureau targets different 

audiences, such as younger consumers and students, in its education efforts. 

• Do you acknowledge that the Securities and Exchange Commission has some jurisdiction 

and oversight authority over companies and financial institutions that participate in the 

federal student loan program through federal contracts? 

Response: Depending on the facts and circumstances, the SEC may ha1•e jurisdiction orer 

such a matter. However, this is a question best answered by the SEC. 

• Do you acknowledge that the Federal Deposit Insurance Corporation has some 

jurisdiction and oversight authority om companies and financial institutions that 

participate in the federnl student loan progrnm through federal contracts'? 

Response: Depending on the facts and circumstances, the FDIC may have jurisdiction over 

such a matter. Howerer, this is a question best answered by the FDIC. 

• Do you acknowledge that the U.S. Department of Justice has some jurisdiction and 

oversight authority over companies and financial institutions that participate in the 

federal student loan program through federal contracts? 

Response: Depending on the facts and circumstances, OOJ may have jurisdiction over 

such a matter. However, this is a question best answered by DOJ. 

• Do you acknowledge that the Consumer Financial Protection Bureau has some 

jurisdiction and oversight authority o1•er companies and financial institutions that 

participate in the federal student loan progrnm through federal contracts? 

Response: A financial institution that participates in the federal student loan program 

through federal contr:acts may be subject to the authority of the Bureau depending on the 

particular status of the institution or actil•ities in which the institution engages. If the 

Bureau were to have jurisdiction owr such an institution, the specific authority the Bureau 

could exercise would be governed by, among other things, the Dodd-Frank Act and various 

legal doctrines that may impact the Bureau's ability to exercise authority over a federal 

contractor. 

• Do you believe that, if confim1ed, il would be appropriate for you to express a preference 

to career enforcement attorneys for a particular outcome in any of the CFPB's ongoing 

litigation? 

59 
117 


71918234.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

Response: The Dodd-Frank Act assigns to the Director of the Bureau the ultimate 

responsibility for opening, closing, suing, and settling decisions in the agency's law 

enforcement matters. In making these decisions, I would consider and give appropriate 

weight to the views and recommendations of career enforcement attorneys. 

• In late May, Ms. Kristen Donoghue, Assistant Director for Enforcement a1 the CFPB, 

sent a letter to the U.S. Department of Education requesting access to student loan 

records, including data and documents, held by Navient Solutions pursuant to the Privacy 

Act of 1974 under 5 U.S.C. § 552a(bX7) and 5 U.S.C. § 552a(b)(3) and that "the 

Department direct Navient Solutions to provide the Bureau with all access that the 

Bureau deems necessary for the Bureau to litigate its claims against Navient Solutions." 

Will you commit to continuing to support the CFPB's request for these student loan 

records? 

Response: I know st11dent lending is a significant issue for man)' Americans, as noted in 

my testimony. Under my stewardship, the Bureau will take aggressil'e action against bad 

actors who break the .rules by engaging in fraud and other illegal activit)•. In addition, I 

plan to sit down with officials at the U.S. Department of Education to talk through what 

their efforts are, where the Bureau can be helpful, and what role the Bureau current!)' 

plays at a more detailed level, including understanding any outstanding document requests. 

60 
118 

RESPONSES TO WRITTEN QUESTIONS OF SENATOR 

VAN HOLLEN FROM KATHLEEN LAURA KRANINGER 


71918235.eps
119 


71918236.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

The U.S. Depanment ()f Educa1ion's Office of Federal Student Aid ("FSA") is planning a pilot 

program for a federal pa)qnent card for students' finandal aid. This card could eventually have 

implications for millions of federal student loan borrowers and grant re<:ipients, and may have 

widespread implications for the financial industry as well. 

• Do you believe it is imponant for the CFPB to be consulted in an ongoing fashion about 

the development and operation of the payment card initiative, including sharing feedback 

during the pilot program? 

Response: I am committed to carr)•ing out the responsibilities of the Bureau under the law, 

which includes working with the U.S. Department of Education. Information sharing is 

''ita! between the Bureau and other regulators. I am committed to sharing information as 

appropriate. 

The CFPB is governed by several other applicable statutes that make it clear that the agency's 

role is to protect consumers who may be abused by financial products or sen• ices. Additionally, 

the CFPB's proposed FY 2018·2022 five-year strategic plan states that the CFPB will "address 

needs for inclusion and financial security of servicemembers, older Americans, traditionally 

underserved consumers and communities, and students." 

• Do you believe the CFPB has responsibility to protect and infonn students about college 

debt and bank account agreements that pose a risk to them as consumers? 

Response: I am firmly committed to fulfilling the Bureau's statutory responsibilities under 

the Dodd-Frank Act and other laws, including the Credit Card Accountability 

Responsibility and Disclosure Act of2009. 

• In 2017, the U.S. Depanment of Education revoked two memoranda of understanding 

between the Depanment and the CFPB. These information-sharing agreements covered 

the sharing of confidential infonnation related to the Bureau's oversight of cenain 

Education Department contractors. Do you agree with Secretary DeVos' decision to 

revoke information-sharing from the CFPB? 

Response: If conlirm~d, I plan to sit down with officials at the U.S. Department of 

Education to talk through what their efforts are, where the Bureau can be helpful, and 

what role the Bureau currently plays at a more detailed level. I am aware that Section 

1035 contemplates a Memorandum of Understanding between the Department and the 

Bureau, and I will work towards that end. I believe that the Bureau should work closely 

with other regulators. I am committed to sharing information as appropriate. 

• During last week's hearing I asked you if you would commit to reestablishing the Oflice 

of Fair Lending and Equal Opponunity. How "111 you prioritize lending discrimination 

as the Director of the CFPB? 

54 
120 


71918237.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

Response: I am firmly committed to fulfilling the Bureau's congressional mandate in 

accordance with the Dodd-Frank Act. In my testimOn)', I committed to examining the 

Bureau's history of enforcement and related litigation to ensure the Bureau effectively 

promotes fair lending. If confirmed, I look forward to having detailed con,·ersations with 

relevant staff to better understand the Bureau's approach to fair lending in education, 

supen·ision, and enforcement matters as well as assess the organizational structure. 

55 
121 

RESPONSES TO WRITTEN QUESTIONS OF SENATOR 

CORTEZ MASTO FROM KATHLEEN LAURA KRANINGER 


71918238.eps
122 


71918239.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

Response: Answering this question requires information that is not available to me. 

Dirersity itr Hiring 

Then CFPB Director Richard Cordray created the Pathways Program to increase diversity at the 

Bureau. It was a two year program for talented, highly skilled people of color. After sen•ing as 

temporary federal employees for two years, people would be converted to full-time employees. 

This would have provided a well-trained diverse staO'but OMB Director Mulvaney ended it. 

During a hearing before the House Financial Services Committee, Mr. Mulvaney said he did not 

have any African Americans in top positions. 

• If confirmed, would you reinstate the Pathways Program, and allow hiring under the 

program? 

Response: Should I be confirmed, I commit to taking a fresh look at the Bureau's 

programs in this area. 

46 
123 

RESPONSES TO WRITTEN QUESTIONS OF SENATORS 

BROWN AND WARREN FROM KATHLEEN LAURA KRANINGER 


71918240.eps
124 


71918241.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

Response: I am firmly committed to fulfilling the Bureau's congressional mandate in 

accordance with the Dodd-Frank Act. In my testimOn)', I committed to examining the 

Bureau's history of enforcement and related litigation to ensure the Bureau effectively 

promotes fair lending. While I will not prejudge and cannot predict el'ery decision that 

will come before me, under my stewardship, the Bureau will take aggressil'e action against 

bad actors who break the rules by engaging in fraud and other illegal activity. 

Operations 

In nominating you, the White House touted your experience in managing agencies' budgets, 

including "the Bureau of Consumer Financial Protection." llte Administration's FY2019 budget 

request contemplated a 23% cut in the Bureau's budget authority from 2019 projected levels. 

• What spe\:ific CIJts did you envision to meet that budget target? 

Response: The Administration's Fiscal Year 2019 Budget was the President's budget 

request, not mine. It also had no actual effect on the agency. I pledge that I will look 

carefully at every line item within the Bureau's budget, should I be confirmed. I believe 

there are opportunities for efficiency. 

• If you did not have specific budget cuts in mind, how did you detennine that a 23% cut 

was appropriate and consistent with fulfilling the Bureau's mission? 

Response: The Administration's Fiscal Year 2019 Budget was the President's budget 

request, not mine. It also had no actual effect on the agency. I pledge that I will look 

carefully at every line item within the Bureau's budget, should I be confirmed. I beliel'e 

there are opportunities for efficiency. 

When Senator Tester asked you whether you intended to keep political appointees, you 

volunteered that you would be open to dismissing civil servants, saying "I'm going to take every 

staff member individually, have a conversation with them to understand what they've been 

working on and what they'd like to continue to work on, and - but I ha1•e not prejudged ha1•ing 

political or career staff continue." 

• Which career staff do you intend to interview? 

Response: As I noted in my testimony, I have not committed to an)' staffing changes, but 

can assure you that I will comply with aU applicable laws and agreements in this area. 

Upon Ill)' arrival at th.e Bureau, ! look fonvard to meeting with as many members of the 

staff as possible. While I will meet with the leadership teams of mry division earl)' on, I 

intend to meet with st:aff across the organization at all le•·els on an ongoing basis. 

• What rubrics will you use to e1•aluate them? 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

Response: With the context prO\'ided in the preceding answer, I will approach the 

organizational structure and the staff with an open mind. My first interactions will be 

focused on listening to them rather than "e''aluating them"-asking for their perspectives 

broadly on the Bureau's operations and mission effectiveness. 

• Do you commit to complying with NTEU·CFPB collective bargaining agreement in 

reassigning or pursuing personnel action against any bargaining unit employee? 

Response: As I noted in my testimony, I have not committed to any staffing changes, but 

can assure you that I will comply with all applicable laws and agreements in this area. 

• Do you commit to complying with all civil sen' ice laws in reassigning or pursuing 

personnel action against any non·bargaining unit civil servant? 

Response: As I noted in my testimony, I have not committed to any staffing changes, but 

can assure you that I will comply with all applicable laws and agreements in this area. 

Typically, independent regulators have modest political staOS. Some regulators, such as the 

Office of the Comptroller of the Currency, have no Schedule C appointees of any kind. No other 

financial regulator has Schedule C appointees in charge of regional omces or regulatOry 

functions, and only one ··the Commodity Futures Trading Commission· has a political head of 

enforcement. None has a political General Counsel. 

• Do you think it is appropriate that OMB Director Mulvaney has deviated from the typical 

practice for independent financial regulators and added more than ten political appointees 

to the CFPB in senior roles? 

Response: As noted in my previous answer, I have not made any staffing decisions. It 

would be inappropriate and premature to make an)' staffing decisions prior to 

confirmation and the .opportunity to meet with staff. 

• Will you commit to removing these new political appointees and depoliticizing the 

agency as it was under fonner Director Cordray? 

Response: As noted in my previous answer, I have not made any staffing decisions. It 

would be inappropriate and premature to make an)' staffing decisions prior to 

confirmation and the <Opportunity to meet with staff. 

Accmmtabiliry 

Other than the CFPB, t~ere are four other federal banking regulatory agencies: the OCC, the 

Federal Resen'e, the FDIC, and the NCUA. 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11utions Heuring 

July 19, 2018 

• Are any of these other banking regulatory agencies funded through the congressional 

appropriations process? 

Response: The prudential regulatory agencies )'Ou mentioned are funded through industry 

assessments, and in the case of the Federal Resen·e, open market operations. Other 

agencies, which are product regulators, are appropriated. 

• Are "major" rul.es issued by any of these other banking regulatory agencies subject to 

congressional appro1•al before they take eiTect? 

Response: At this time, no major rule issued by a federal agency is subject to legislative 

approval before the rule takes effect. 

• Since lhe CFPB was crea1ed by Congress, how many repons relaling 10 1he CFPB has lhe 

Federal Reserve's Inspector General issued? 

Response: It is my understanding that the Inspector General has issued 64 reports about 

the Bureau. 

• The CFPB Director must testify before Congress four times a year. Are the heads of the 

OCC, FDIC, and NUCA subject to a similar requirement? 

Response: I am not familiar with the specific testimonial requirements for the agencies )'OU 

mentioned, although I am aware that the heads of other agencies, such as the Federal 

Reserve and Department of the Treasury must testify multiple times a )'ear. 

• The CFPB's rul.es may be vetoed by the Financial Stability Oversight Council (FSOC). 

Are rules issued by any of the other banking regulators subject to an FSOC veto? 

Response: At this time, the FSOC set aside does not apply to any of the other financial 

sen•ices regulators. 

Research, Markets a11d Regulations 

In your opening statement, you said that you would prioritize ensuring that the Bureau makes 

"robust use of cost benefit analysis" as required by Congress. As you correctly identified, Dodd· 

Frank requires CFPB mles to undergo wst·benefit analysis, which the Bureau has done for every 

CFPB rule that has bee11 finalized. 

• What, if any, shoncomings have you identified in the cos1-benefit analyses that have 

accompanied Cf PB rules? 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

Response: As I discussed in my testimony, I am committed to data-dri1•en decisionmaking. Under my leadership, that would be a focal point at the Bureau- not just as it 

pertains to rulemaking actions. A direct response to this question could inappropriately 

inOuence Bureau rulemakings-whether already in effect as it pertains to enforcement, in 

the notice and comme-nt process under active consideration, and being reassessed pursuant 

to the Dodd-Frank Act requirements. Should I be confirmed, I am committed to 

transpmnt processes and data-drh·en decision-making. 

• Do you support OMB Director Mulvaney's proposal that CFPB establish a redundant 

office of cost-benefit analysis within the Office of the Director? 

Response: As noted abon, I am committed to data-driven decision-making- not just as it 

pertains to rulemaking. More specifically to the office of cost-benefit analysis, it would be 

inappropriate and premature to make any staffing or organizational decisions prior to 

confirmation and the <Opportunity to meet with staff. I hare noted that I will approach the 

organizational structure with an open mind. 

You say in your testimony that the "the bureau would limit data collection only to what is 

required under law and is necessary to carry out its mission and ensure that the data is protected." 

What data that the Bureau now collects will no longer be collected under this standard? For the 

categories of data that the agency collects, please refer to the Government Accountability 

Office's 2014 report titled Consumer Financial Protection Bureau: Some Privacy and Security 

Procedures for Data Collection Should Continue Being Enhanced. 

Response: As noted in my testimony and other responses to questions for the record, 

limiting data collection in the manner I have pledged is consistent with supporting robust 

use of cost-benefit analysis and a commitment to data-driren decision-making. To the 

extent that the data is supporting decision-making, the data collection would be needed and 

required. Further, it s important to note the many sources of el'idence available to the 

Bureau be)·ond the entities that the Bureau is supervising directly. For example, data that 

comes through requests for information that are out to the public. The Bureau must 

recognize its profound duty to the American people to protect the data in its possession. 

In your testimony and in response to questions from Senator Toomey, you expressed the 

importance of the Administrative Procedure Act rulemaking process, including notice and 

comment The CFPB's rule on Payday, Vehicle Title, and Certain High-Cost Installment Loans 

used was promulgated using that process. Agency staiT considered more than a million 

comments 01•er fi1•e years and the final rule had significant dinerences from the proposal. But, 

before the rule was ever able to meaningfully go into effect, the CFPB under OMB Director 

Mulvaney announced his intent to revisit it 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

• Do you support revisiting the payday rule? If so, please describe the specific defects with 

the notice and commenl process for the first payday rulemaking. If not, how do you 

reconcile your view of the importance of the notice and comment process 11~th your 

willingness to reopen a rule that has gone through notice and comment but hasn't been 

allowed to go into enect? 

Response: The Bureau's Payday, Vehicle Tille, and Certain High-Cost Installment Loans 

rulemaking is actil•ely under reconsideration, and it is not appropriate for me to comment 

on it. I understand th.e point )'Ou are making and, if confirmed, pledge to examine this 

issue closely. 

Miscellaneous 

• OMB Dire<:tor Mulvaney has been in charge of the CFPB for eight months. Can you 

idemify any actions he has taken that you disagree with and explain why you disagree 

with them? 

Response: Based on 1 he information that is al'ailable to me at this time, I cannot identify 

any actions that Acting Director Mulvaney has taken with which I disagree. I have pledged 

to approach organizational and staffing structures with an open mind as well as not to 

prejudge any matter that should come before me if confirmed. 

You told the Commillee that your first priority would be to make sure the CFPB is "transparent 

and fair, ensuring its actions empower consumers to make good choices and provide certainly for 

marketplace participants." The Bureau is required by Dodd-Frank to accept complaims from 

indi1•idual consumers and since its launch has made these complaints public, providing increased 

tra•tsparency to the mar.ketplace. lnfomtation gleaned from the database has empowered 

consumers to make moie infonned choices in the financial marketplace, provided businesses 

with insight into potential partners and allowed researchers to have real-time insight into trends 

in the market. The transparency has also incentivized financial institutions to be responsive to 

their customers. Despite this, OMB Director Mulvaney has threatened several times to take d01111 

the public-facing consumer complaint database, hiding this crucial infomtation from those who 

can use it. 

• Will you commit to keeping the database public? If not, please explain how it would be 

more "transparent" or how it would "empower consumers" to hide this infonnation from 

them? 

Response: As I have pre1•iously stated, I will not prejudge any decision that will come 

before me at the Bureau, including whether to keep the consumer complaint database 

public. I am aware of the statutory responsibility for the Bureau to collect and track 

consumer complaints. If confirmed, I will full)' examine this issue and all appropriate 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

considerations with a focus on the ensuring the Bureau is transparent and accountable to 

the American people for its actions. 

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130 

RESPONSES TO WRITTEN QUESTIONS OF SENATORS 

BROWN, REED, MENENDEZ, WARNER, WARREN, SCHATZ, VAN 

HOLLEN, AND CORTEZ MASTO FROM KATHLEEN LAURA 

KRANINGER 


71918247.eps
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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

Response: I had no role in setting the zero tolerance policy. Since the beginning of the 

administration, officials within the Office of~lanagement and Budget, including the 

director, the deputy director, me, and my staff, participated in meetings related to 

immigration and border security policy that included rele1•ant officials across the 

administration. OMR has an extensil'e role in supporting agencies as they implement the 

President's priorities and agenda, which includes re1•iewing legislatil'e proposals, 

regulatory proposals, and the a1•ailabilif)• of budgetary resources, including those 

regarding immigration and border security. I also testified more specifically that OMB 

was engaged in discussions regarding mource needs, including supporting agencies in 

analysis of those needs and appropriations law. 

• You testified th3t '\vith respect to the IRS rule [on disclosing political donations], I was 

aware of it happening. I know that my stall· reviewed it." Were you aware that the child 

separation policy was happening? Did you or your stan· review it? 

Response: I was not involl'cd in setting the policy. The IRS action is different in kind as it 

was undertaken through a rulemaking effort, which is why my staff re1•iewed it. 

• You testified th3t "horrible disasters last fall, because there was clear need for additional 

resources, the Onice of Management and Budget was ·· was very engaged." Were 

additional resources required to implement the child separation policf, lfso, did the 

Ofilce of Management and Budget appro1•e or reject any requests for additional resources 

or play any other role in providing resources? What role did you personally play in 

determining whether to approve or deny any such requests? 

Response: I had no role in setting the policy. Since the Office of Management and Budget 

(OMB) has an extensive role in supporting agencies as they implement the President's 

priorities and agenda, including reviewing legislative proposals, regulatory proposals, and 

the a1·ailability of budgetary resources, I have participated in a number of meetings on 

immigration and border security in that context. OHS submitted a reprogramming and 

transfer request to the Committees on Appropriations, Subcommittees on Homeland 

Security, on June 30th. I did not personally rel'iew the request, since the discussions 

occurred after my nomination. 

• Please provide a complete description of any role you may have played in OMB 

budgetary or policy decisions, analyses, or recommendations related to DOJ's "ZeroTolerance Policy," DHS's implementation of the changes stemming from this policy, and 

the separation of children from their parents who were detained under such policy. 

Please include a list of all meetings you a11ended (in person or by telephone or other 

electronic means) related to these budgetary or policy decisions, analyses, or 

recommendations, the topics discussed in these meetings, and a list of all other allendees 

of these meetings. 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

Response: In light of the confidentiality interests that attach to executil'e branch decisionmaking, I am unable to answer this question. 

• Please provide all em ails and other documents related to your communications with DOJ 

oflicials related to the development and implementation ofDOJ's "Zero-Tolerance 

Policy" and the separation of children from their parents who were detained under such 

policy. 

Response: Any such documents would not belong to me, and, as a result, I would not have 

the authority to produce any such documents if they existed. 

• Please provide all emails and other documents related to your communications with DHS 

oflicials regarding the DHS's role in separation of children from their parents who were 

detained under the DOJ Zero Tolerance policy. 

Response: Any such documents would not belong to me, and, as a result, I would not have 

the authority to produce any such documents if they existed. 

• Please provide all em ails and other documents related to your communications with 

White House oflicials, including Senior Advisor to the President Stephen Miller, related 

to the development of the Zero Tolerance Policy, DHS's implementation of changes 

stemming from the Zero Tolerance Policy, or the separation of children from their parents 

who were deta ~ed under the DOJ Zero Tolerance policy. 

Response: Any such documents would not belong to me, and, as a result, I would not ha•·e 

the authority to produce any such documents if they existed. 

• Please provide any final or draft OMB ana )~es. recommendations, or budgetary or 

policy decisions in which you were involved related to the DOJ Zero Tolerance Policy, or 

related to DHS role in this policy, including DHS's role in the separation of children from 

their parents who were detained under the DOJ Zero Tolerance policy, and any emails, or 

other communications related to these final or draft recommendations, or budgetary or 

policy decisions. 

Response: Any such documents would not belong to me, and, as a result, I would not ha1•e 

the authority to produce any such documents if they existed. 

Puerto Rico 

• Please provide a complete description of any role you may hal'e played in OMB disaster 

supplemental appropriations requests to Congress, budgetary or policy decisions, 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19,2018 

analyses, or recommendations related to the Tmmp Administration's response to 

Hurricane Maria. Please include a list of all meetings you attended (in person or by 

telephone or other electronic means) related to these disaster supplemental appropriations 

requests to Congress, budgetary or policy decisions, analyses, or recommendations, the 

topics discussed in these meetings, and a list of all other attendees of those meetings. 

Such documents should cover, but not be limited to, any meetings, communications, or 

deliberations related to the following requests and appropriations: 

• October 4, 2017 requested supplemental; 

• Public Law Number 115-72; 

• November 17,2017 requested supplemental; and 

• Public Law Number 115-123. 

• Pie~ provide all emails and other documents related to your communications with DHS 

oflicials related to the development of disaster supplemental appropriations requests to 

Congress and implementation of enacted appropriations. 

Response: The Oflice of Management and Budget has a role in reviewing disaster 

declarations that go to the President and putting together the supplemental requests that 

the administration transmits to the Congress. In my role at OMB, I supported the 

President in the development of the supplemental requests for Hurricanes Irma and Maria. 

In light of the confidentiality interests that attach to executi1•e branch decision-making, I 

am unable to fulfill your request. As to the request for documents, any such documents 

would not belong to n1e, and, as a result, I would not have the authority to produce any 

such documents ifthej' existed. 

• Please provide all emails and other documents related to your communications with 

Treasury oflicials related to the development of disaster supplemental appropriations 

requests to Congress and implementation of enacted appropriations. 

Response: Any such documents would not belong to me, and, as a result, I would not ha1•e 

the authority to produce any such documents if they existed. 

• Please provide all em ails and other documents related to your communications with HUD 

oflicials related to the development of disaster supplemen1al appropriations requests to 

Congress and implementation of enacted appropriations. 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

Response: Any such documents would not belong to me, and, as a result, I would not ha1•e 

the authority to produce any such documents if they existed. 

• Please provide all em ails and other documents related to your communications with 

Puerto Rico government officials, employees, and consultants, related to the development 

of disaster supplemental appropriations requests to Congress and implementation of 

enacted appropriations. 

Response: Any such documents would not belong to me, and, as a result, I would not have 

the authority to produce any such documents if they existed. 

• Please provide any final or draft OMB analyses, recommendations, or budgetary or 

policy decisions in which you were involved related to the Administration's response to 

Hurricane Maria, and any emails, or other communications related to these final or draft 

recommendatioltS, disaster supplemental appropriations requests, or other budgetary or 

policy decisions. 

Response: Any such documents would not belong to me, and, as a result, I would not ha1•e 

the authority to produce any such documents if they existed. 

• Please provide all emails or other documents relating to your involvement with the 

Trump Administration's response to Hurricane Maria, including but not limited to: 

negotiations or discussions with Puerto Rico government ofilcials, employees, and 

consultants regarding the intent, design, statutory language, and implementation of the 

community disaster loan in the Public Law Number 115-72; and negotiations or 

discussions witm Puerto Rico government ofticials, employees, and consultants regarding 

the procedures related to Section 428 of the Stafford Act. 

Response: Any such documents would not belong to me, and, as a result, I would not have 

the authority to produce any such documents if they existed. 

Transparency 

• At the hearing, you claimed that the infonnation and documents multiple Senators were 

requesting about your role in the development and implementation of the child separation 

policy were protected by the deliberative process pri1•ilege. You also testified that the 

Administration was not fonnally invoking the deliberative process privilege and that you 

were not personally invoking the deliberative process privilege on the advice of counsel. 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19,2018 

• As of the date of your response to the questions in this document, is the Tmmp 

Administration invoking any privilege with regard to any of the infonnation or 

documents requested in the letter from Senators Warren and Brown on June 18, 20 18? 

Response: I am not in a position to comment on behalf of the Administration. 

• As of the date of your response to the questions in this document, are you personally 

invoking any privilege with regard to any of the infonnation or documents requested in 

the lener from Senators Warren and Brown on June 18, 2018? 

Response: In light of the confidentiality interests that attach to executh•e branch decisionmaking, I am unable to provide responses to the requests for information. As to the 

requests for documents, any such documents would not belong to me, and, as a result, I 

would not have the authority to produce any such documents if they existed. 

• If either you or the Tmmp Administration is invoking any privilege with regard to any of 

the documents or infonnation requested in the June 18th leuer, please describe in detail 

which documents and infonnation the pri1•ilege protects and cite legal precedent for your 

claim that the privilege applies to such documents or infonnation. 

Response: Please see the response above. 

• If neither you nor the Trump Administrntion is invoking any privilege with regard to the 

some or all of the infom1ation or documents requested in the June 18th leuer, please 

explain why it is appropriate to withhold that non-privileged infonnation from the 

Banking Commiuee before the Commiuee votes on your nomination. Please keep in 

mind that the material requested bears directly on your ability to manage complicated and 

important policies- which will be your responsibility if con finned to mn the CFPB- and 

that both you and the Tmmp Administration have specifically touted your purported 

management expertise as the primary reason to con finn you to this position. 

Response: Please see the response above. 

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RESPONSES TO WRITTEN QUESTIONS OF SENATORS 

BROWN, MENENDEZ, WARREN, AND CORTEZ MASTO FROM 

KATHLEEN LAURA KRANINGER 


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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

At a hearing on the Semi Annual Repon of the CFPB, Mr. Mulvaney told Represematives and 

Senators that while he was required to appear in from of several conuniuees in Congress, he was 

not required by the statute to answer questions from Congress. 

• Do you agree with his reading of the statute? 

Response: The Acting Director has discussed his interpretation of section I 016 of the 

Dodd· Frank Act in comparison to the requirements of other financial regulators in statute. 

You have my commitment to appear at the Bureau'ssemi·annual hearings and answer 

questions to the best of m)' ability, just as Acting Director Mulvaney and Director Cordray 

have done. 

• If confirmed, will you commit to timely answering all inquiries from Congress? 

Response: You have rn)' commitment to appear at the Bureau's semi-annual hearings and 

answer questions to the best of my ability,just as Acting Director Mulvane)' and Director 

Cordray have done. As a former Congressional staffer, I appreciate the important role 

that Congress plays in overseeing the Bureau and am committed to working with all 

Members of Congress in a productive manner. 

In a speech to the American Bankers Association, Mr. Mulvaney said the first thing he did when 

he got to the CFPB is read the law-"the re11ding of the statute actually revealed some very 

interesting things"-whereupon he decided that the "Consumer Financial Protection Bureau" 

was a misnomer. Prior to reading the statute, while he was in Congress, Mulvaney criticized the 

CFPB but never raised its name as a concern. In his current role, he refers to the agency as the 

Bure11u of Consumer Financial Protection (BCFP). 

• Do you believe it is illegal or inappropriate to call the agency the Consumer Financial 

Protection Bureau, or identify it as such in ofticial correspondence, work products, on 

rt>al estate, etc? 

Response: I do not know how the Bureau came to be identified as the "Consumer 

Financial Protection Bure.au" rather than the "Bureau of Consumer Financial Protection," 

as it was named in the Dodd-Frank Act. More specifically, I do not know whether there 

was a legal opinion, any marketing/branding research, or other evidence or data that 

resulted in that decision. As such, I do not have an opinion on whether it is illegal or 

inappropriate. 

• Do you believe it is important that Americans easily recognize the CFPB and the 

materials it produces? Do you believe changing the name of the CFPB inhibits 

Americans recognition of the Bureau, or undemtines years of branding efforts undertaken 

thus far? 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

Response: Yes, I believe it is important for the Bureau to have a strong brand given its 

statutory responsibility for consumer financial education and collection and tracking of 

consumer complaints as well as other responsibilities. Howe1•er, consistent with my 

response to the previous question, I do not ha1•e any information on the impact of the name 

change or of the strength of the Bureau's brand prior to the name change. 

• As an OMB budget expen who o1•ersaw the CFPB, what amoum ofCFPB resources are 

being spemto rebrand the CFPB? Do you think those resources were wisely deployed? 

Do you think it resulted in any confusion? 

Response: I do not hal'e access to information relating to the effects, if any, of the use of 

the Bureau's statutory name, including any budgetar}' impacts associated with this change. 

Should I be confirmed, I look forward to consulting with Bureau staff and learning more 

about this issue. 

• If confirmed, will you commit further resources to renaming or rebrnnding theCFPB? If 

so, what ponion of the Bureau's budget would you dedicate to renaming and rebrnnding 

efforts? 

Response: I recognize that some have disagreed with the Acting Director's decision to 

return to the Bureau's statutory name. Consistent with my responses above, it is not 

appropriate to prejudge this issue, particularly without the benefit of information that is 

not available to me. 

In a leuer dated Angus! 31,2017 the Depanment ofE1lucation stated that it has "full Ol'ersight 

responsibility of federn I loans." Do you agree with the Depanment of Education, or does the 

CFPB also have oversight responsibility of federal student loans? Please explain the full extent 

of the CFPB's responsibility regarding federal student loans according to your understanding of 

the law. In September 2017, the Department of Education terminated a Memorandum of 

Understanding with the CFPB regarding information sharing with the Student Loan 

Ombudsman, and is allegedly blocking a document request by CFPB in support of the Bureau's 

la\\~uit against Navienl, a student loan sen•icer. 

• If confirmed to lead the CFPB, will you continue to press Na1•ient and the Depanment of 

Education to provide responses to CFPB document requests? 

Response: I know st11dent lending is a significant issue for man)' Americans, as noted in 

my testimony. Under my stewardship, the Bureau will take aggressive action against bad 

actors who break the -rules by engaging in fraud and other illegal acth•ity. In addition, I 

plan to sit down with officials at the U.S. Department of Education to talk through what 

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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

their efforts are, where the Bureau can be helpful, and what role the Bureau currently 

plays at a more detailed level, including understanding any outstanding document requests. 

The President has used Twiner in an attempt to influence members of the Board ofGovemors of 

the Federal Reserve System, and to influence Mr. Mulvaney in his duties at the CFPB. 

• If confirmed, do you pledge to perfonn your job independently of the President and 

anyone who reports to the President, and to ignore any anempts by the President or 

anyone who repons to the President to influence investigations, enforcement actions, or 

supervision of entities subject to CFPB Ol'ersight? 

Response: As I noted jo my testimony, the Congress through the Dodd·Frank Act ga•·e the 

Bureau incredible powers and incredible independence from both the President and the 

Congress in its structure. I pledge to manage the Bureau consistent with its authorities and 

responsibilities under the law and to ensure its continued de1•elopment as a mature 

regulator within our Nation's financial regulatory framework. 

You told the committee you would look at disparate impact issues. When Brian Johnson, who 

has been appointed Deputy Dil'l.>ctor for the CFPB, was employed by the House Financial 

Services Committee, the Committee Majority issued a staff report that called disparate impact 

theory "controversial" and argued that disparate impact claims are not "cognizable under ECOA 

[the Equal Credit Opportunity Acl]" and" ... ECOA focuses solely on the imem of the actor. 

• Do you agree with the conclusions of the staff report? In your opinion, can the CFPB 

enforce ECOA (!aims under theory of disparate impact? 

Response: It is abhorrent that discrimination exists in sociel)' and in the markets. I am 

committed to enforcing the law with respect to discrimination. With respect to court cases 

and enforcement actions, as you are well aware, the arguments about disparate impact are 

l'ery complicated. It is a challenging area, legally speaking, in part because the Supreme 

Court has nel'er addressed whether disparate impact is cognizable under the Equal Credit 

Opportunity Act. I can commit to you, that should I be confirmed in this position, I will 

have a detailed con1·ersation with the rele••ant staff on this topic, to better understand the 

positions the Bureau 1\as taken in the past on this issue, and the status of any litigation on 

the issue. I will tbeo use that information to take the appropriate actions to ensure that the 

Bureau is promoting fair lending within the applicable legal requirements. 

• If you are confim1ed, will the Deputy Director be part of the team who reviews the 

CFPB's use of the disparate impact theory? 

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71918257.eps

Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

Response: If confirmed, I will haYe a detailed conYersation with the relevant staff on this 

topic, to better understand the positions the Bureau has taken in the past on this issue, and 

the status of any litigation on the issue. 

ln your testimony, you identified transparency and accountability as priorities of yours. 

• Will you pledge to maintain the Consumer Complaint Database in its current, transparent 

fonn so that financial companies can be held accountable by their customers? 

Response: As I hal'e pre1•iously stated, I will not prejudge any decision that will come 

before me at the Bureau, including whether to keep the consumer complaint database 

public. I am aware of the statutory responsibility for the Bureau to collect and track 

consumer complaints. If confirmed, I will full)' examine this issue and all appropriate 

considerations with a focus on the ensuring the Bureau is transparent and accountable to 

the American people for its actions. 

• If con finned, will you reverse Mr. Mulvaney's reorganization of the Office of Fair 

lending and Equal Opportunity and restore its enforcement powers, as required by 

statute? 

Response: As I discussed in my testimony, enforcing the fair lending laws is a critical 

responsibility of the Bureau, regardless of organixational structure. I can commit to 

approaching the organizational structure with an open mind. It would be inappropriate 

and premature to make any staffing or organizational decisions prior to confirmation and 

the opportunif)• to meet with staff. 

• If confirmed, will you reverse Mr. Mulvaney's reorganization of the Office for Students 

and Young COilsmners? 

Response: Student lending is a significant issue for many Americans and one that I will 

examine close!)', if confirmed. I will re1'iew the structure of the organization with an open 

mind. 

The Consumer Advisory Board (CAB) is composed of academics, consumer advocates, and 

industry representatives with deep financial experience, and was established by statute to help 

infom1 the CFPB Director of de1•elopments in consumer financial products and markets. The 

current CAB was disbanded by Mr. Mulvaney, and new charters were IITitten, shrinking the size 

of the CAB. 

• If confim1ed, do you pledge to reassemble the CAB that Mr. Mulvaney disbanded, restore 

the charters, and meet with CAB members in order to learn more about the financial 

industry? 

41 
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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

Response: Should I be confirmed, I look fomard to engaging with a broad range of 

external stakeholders, including the Bureau's advisory committees. While I recognize the 

importance of having many annues for stakeholder engagement, I am committed to 

carrying out the Bureau's statutory requirements for engagement, including through the 

Consumer Ad,•isory Board. 

• Do you believe that CAB members are more concerned about protecting their taxpayer 

funded junkets to Washington, D.C., and being wined and dined by the Bureau, than 

protec.ting consumers? 

Response: Should I be confirmed, I look fomard to engaging with a broad range of 

external stakeholders, including the Bureau's ad,·isory committees. 

The CFPB Director also votes on the financial Stability Oversight Council, whose job is to 

identify and mitigate threats to the stability of the financial system. 

• What experience do you have forecasting or monitoring systemic risks to the economy? 

Response: In a professional capacity, I ha\'e not had direct experience with the Financial 

Stability O"ersight Council, but I have made myself familiar with the statutory 

responsibilities of the Bureau in this space. Further, if confirmed, I will engage with 

Bureau staff and other FSOC leadership to deepen my understanding of these important 

issues. 

• What is the role of the Consumer Financial Protection Bureau in preventing financial 

catastrophes? 

Response: Under the Dodd-Frank Act, the Bureau is responsible for implementing and 

enforcing Federal consumer financial laws to ensure fair, transparent, and competitil'e 

markets for consumer financial products and services. Further, the Bureau must identify 

risks to consumers and to the proper functioning of such markets. 

• In your opinion, what are the most imminent threats to financial stability at present, and 

what should be done to mitigate those threats? 

Response: If confirmed, I look fomard to working with staff at the Bureau and the FSOC 

to more fully understand potential risks to financial stability. Consistent with the FSOC's 

statutory mandate, I believe that it is important to identify risks and ways to mitigate them. 

For example, among other things, given the heavy reliance on technoiOg)' within the 

financial sector and society as a whole, I belie,·e that cybersecurity incidents remain a 

significant concern. The recommendations in the 2017 FSOC annual report regarding 

information sharing, instituting and enhancing baseline protections, and rapid response 

42 
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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

and recovery are important mitigation efforts. I know these are important issues which I 

will examine closely in coordination with the other members of the FSOC. 

Research by the Federal Reserve Bank ofSt Louis found that 70% ofsubprime mongages from 

2000 to 2007 were refimancings. Please describe, in detail, your analysis of the role thai subprime 

mongage refinancings played in the economic collapse of2008 and the resulting recession and 

foreclosure crisis. 

Response: There wer~ a multitude of causes to the financial crisis including subprime 

mortgage lending an<l "the vulnerabilities that created the potential for the crisis were 

years in the making," as set forth in the Financial Crisis Inquiry Commission 

Report. Many factors, such as lax undenvriting guidelines, regulatory changes, and the 

incentim for firms and banks to securitize those mortgages, spurred the sub prime lending 

acti,•ity. Too many entities and individuals took risks since they could pass on those risksclearly failures by regulators played a role as well. Major changes have been made to the 

system since the financial crisis, including standards for the ability to repay in mortgage 

lending. 

The Office of Management and Budget often reviews agency responses to Questions forthe 

Record before they are submilled to Congress. Following hearings with the Secretary Carson and 

Director Mulvaney regarding the Depanment of Housing and Urban Development (HUD) and 

Consumer Financial Protection Bureau, we have not received responses to submilled questions. 

• Is it the responsibility of you or your staiTto review responses to Questions for the 

Record before they are submilled to Congress by HUD or CFPB? 

Response: The Office of Management and Budget coordinates interagency review of 

responses to Questions for the Record before they are submitted to Congress. There are 

certain agencies for whom this general policy does not apply, such as the Bureau. 

• Is OMB responsible for pari of the delay in responses to Congress? 

Response: No. 

Secretary Carson recei,·ed Questions for the Record on April5, 2018 following a hearing on 

March 22,2018. 

• How many days, in total, have HUD questions been under review at OMB? For how long 

do you think it is appropriate for OMB to withhold answers from Congress while it 

43 
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Committee on Banking, Housing, and Urban Affairs 

Nomi11ulions Heuring 

July 19, 2018 

reviews agency responses? 

Response: OMB begins interagency re1•iew of responses to Questions for the Record as 

soon as they are recei,·ed, and works expeditiously to pro1•ide answers to Congress in a 

timely manner. HUD's responses were transmitted on Tuesday, July 26". 

44 
144 

RESPONSES TO WRITTEN QUESTIONS OF SENATOR BROWN 

FROM KIMBERLY A. REED 


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Committee on Banking, Housing, and Urban Affairs 

Nominations Hearing 

July 19,2018 

While I do not yet have a~ess to information to comment on Exlm's intemal processes, I, if 

confirmed, along with lhe required Bank Board quorum, look forward to approving a qualified 

Chief Risk Ofticer and working with them and the Board to ensure that Exlm follows the best 

risk management and mitigation practices. 

I am dedicated to good govemance and believe that it is appropriate to have regular reviews of 

key items important to Exlm stakeholders and the Americ<lll taxpayer. I, if confirmed, will work 

with other offices 11~thin the U.S. government and, as appropriate, the OECD, G20, WTO, and 

other forums to move towards the goal set by the Congress in law of eliminating all export credit 

financing worldwide. I would work with the Congress and the Exlm Inspector General, Chief 

Ethics Officer, and Chief Risk Officer to ensure we are doing all we can to eliminate waste, 

fraud, and abuse and give better value to the taxpayer. 

I believe that Exlm also must treat all American companies fairly, especially small and medium 

enterprises. I, if confirmed, will ensure that Exlm-working with community banks and 

community development financial institutions- helps small businesses and the agriculture 

sector, which is vital to rural America. All companies and all workers should have appropriate 

access to the programs authorized by Congress. I would encourage Exlrn staff to work with all 

stakeholders- Congressional offices, community banks and credit unions, local Chambers of 

Commerce, trade, manufacturing, business, and agriculture organizations. local government 

agencies, women and minority-owned business organizations, the media, academia, and othersto proactively share Ex:Im's mission and products with small businesses. Through this outreach, 

Exlm should identify unmet needs and gaps where the Bank -while not competing with the 

pri1<ate sector- could make the difference for American workers and exports. Exlm should ha1•e 

effective measurement processes to track impact and retum on investment, including to identify 

new small business applicants and the creation of U.S. jobs, while protecting the American 

taxpayer. 

Q4. Do you believe it is important to seek public comment from Ex-lm customers and the 

general public before making any changes that would significantly affect the availability of 

credit from Ex-lm for certain products or economic sectors? 

A4. Yes, I believe that it is important to seek public comment from all stakeholders, as well 

receive input from the Congress and Administration colleagues, before making any changes that 

would significantly aft~t the availability of credit from Exlm for certain products or economic 

sectors. 

Q5. If confirmed, will you publicly defend the Export-Import Bank against false or misleading 

charges of fraud? 

A5. Once a final detem1ination is made by the Office of Inspector General, law enforcement, 

chief ethics official, andfor other appropriate official, I, if confirmed, will work with my Board 

colleagues to ensure that Exlm appropriately responds to any false or misleading charge of fraud. 

Q6. Do you see a need to impose an upper limit on doing business with any particular industry or 

commercial sector, like aerospace manufacturing, that has previously relied heavily on Ex-lm to 
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Committee on Banking, Housing, and Urban Affairs 

Nominations Hearing 

July 19,2018 

access foreign markets? Or should Exlm's lending be driven by demand from qualified 

applicants, to the extent permitted by the Bank's chaner? 

A6. I, if confirmed, will faithfully execute all laws consistent with the intent of Congress, and 

within the authority of the Exlm President. I will review each transaction independently, on the 

merits, and in accordance with the Exlm Chaner established by the Congress and Bylaws. 

Q7.lf confirmed, would you work to ensure that the comment process for environmental and 

social impacts from projects is properly structured and adequately resourced to ensure that 

comments from concerned parties are meaningfully considered? 

A7. Yes,!, if confirmed, will work with my fellow Board Members and Exlm staff to ensure 

that the environmental and social impact comment process is proper! y structured and adequately 

resourced to ensure comments from concerned panics are meaningfully considered. 

Q8. If confirmed, do you commit to providing all documents and materials that the Office of 

Inspector General requests? 

A8. Yes, I, if confirmed, will commit to providing all documents and materials requested by the 

Office of Inspector General in accordance with Federal laws and regulations. I value the 

independent role that Inspectors General play at Exlm and in our government. 
147 

ADDITIONAL MATERIAL SUPPLIED FOR THE RECORD

DOCUMENTS SUBMITTED IN SUPPORT OF THE NOMINATION OF 

KATHLEEN LAURA KRANINGER 


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agenda-driren, lacking in objeclive evidentiary support, dismissive of both the Small Business 

Regulatory Enforcement Faimess Act ("SBREFA") small entity representative (''SER") input 

and the need for rigorous cost-benefit anal) s, and poorly conceived to solve real problems. Tlte 

following pre-rule actions by the Bureau need to be improved upon: a flawed and nontnmsparent consumer Sl.ll>'ey; Failure to conduct effective consumer disclosure testing; a 

misconceived SBREFA panel process that failed to include critical participants and issues while 

inappropriately seeking to impose a "one size fits all" approach; regulatory overreach; and 

unworkable proposals. With respect to SBREFA, many industries and small businesses have 

observed that the Bureau has treated this important process as an empty, fomtalistic exercise, 

obligatorily tacked on the end of the Bureau's pre-rulemaking schedule, well past the point when 

the Bureau's course was set. 

ACA's members Face a barrage oflegal obligations imposed by an array of Federal and state 

authorities. As they have repeatedly made clear, they would welcome sensible regulation to 

resolve conflicting and ambiguous requirements that currently Foster costly, often frivolous 

litigation, and remain ready to work with the Bureau toward achievement of this goat ACA has 

urged the Bureau to work collaboratively with regulated entities to develop workable, eftlxtive 

regulation, and to revamp the Bureau's approach toward SBREFA, in a way that fulfills the 

statute's intended purpose, reducing unnecessary burden while achie1•ing appropriate regulatory 

objectives. As the BCFP takes steps towards proposed mles for the credit and collection 

industry, we urge Congress to work closely with the Bureau to ensure that any new rules protect 

consumers, and also the interest of small and medium sized business 01mers in your state, and 

the thousands of constituents they employ. 

11. The BCFP's Complaint Database Paints an Inaccurate Portrait of the Debt 

Collection Industry 

The Bureau has repeatedly reported that debt collection receives the highest number of 

complaints. However in 2017, the Bureau received 84,500 complaints about debt collection as 

compared to I 00,000 complaints regarding consumer reporting and credit repair and 37,300 

complaints regarding mortgages.' The amount of debt collection complaints reported to the 

Bureau actually decreased as compared from 2016, yet the Bureau has continued to assert 

incorrectly that this category of complaint exceeds all others. Beyond this mischaracterization, 

the Bureau fails to contextualizc the number of complaints as compare-d to the number of 

contacts the debt collection industry makes to consumers over a given )•ear, which the 

Philadelphia Federal Reserve estimates to be well over one billion.2 Providing better 

understanding of and perspective on the debt collection marketplace would better serve the 

Bureau - and consumers- in the Bureau's analysis of the debt collection industry. The Bureau 

should focus its resources on actual hamt rather than raw numbers of complaints provided 

without context. In do ~g do, the Bureau would realize that debt collection complaintS account 

for only 0.005% of all consumer contacts made in a given year by debt collectors. 

1 Sourtt: CFPB Consumer Response Annual RcporUanuary I-ll<.'ttlnbcr 31, 20t7. 2 Robert ~t.llunt, PhO. Viet Prcsidenund Oi~<.-c!or. l'aym<nl Cards Cen~er Federnl Reserve Bank of Philadelphia. 

Unders.,nding 1he Model: 1i'he Lire Cycle or a Oebt Presemed 31 "Life or a Oebt Oa"' tmcgri1y in Oeb1 

Collmion." f'TC-CFPB RoWJdlablc(Junc6. 20t3)ol'oilobleot hnps1Amw.ftc.gov/newxl·tni¥el'en!Scalen®l1013i061life:<lebt-dala-imegrily-d<b!<ollccli01!. 
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Ironically, the Bureau also repons that the debt collection industry has a response rateof94.4% 

in 2017, one of the highest rates of at1y industry that receives Bureau complaints. 3 What the 

Bureau f.1ils to publiciz:e is that 84% of debt collection complaints are closed "with 

explanation," meaning the consumer's issue was specifically addressed and/or resolved. 

4 This 

too is an extraordinarily high percentage. 

A. Complaims are Defined Too Broadly and Not Othenrise Verified. 

The most troubling aspect of the ccmplaint database for ACA members is the Bureau's 

treatment of complaints including: (I) the Bureau's broad delinition of a complaint as 

"submissions that express dissatisfaction with, or communicate suspicion of 11~ongful conduct 

by, an identifiable entity related to a consumer's personal experience with a financial product or 

service," 1 and (2) the Bureau's failure to verify the accuracy of the ccmplaints it receives. The 

Bureau's approach to C<lnsumer complaints in this fashion results in complaints being counted 

against debt collectors for conduct. which even if tn•e, is not othem~se unlawful, but more 

imponanlly is often factually inaccurate. For example, a consumer may submit a complaint that 

his or her insurance company should have paid a medical bill. in this instance, the debt collector 

did not engage in any tmlawfi•l conduct, yet the complaint is counted against it el'en though the 

debt collector had the right to contact the consumer. in the same scenario, if the consumer 

makes the same complaint against the 0111ter of the debt, the medical provider, the complaint is 

also counted against the debt collector, and thus two complaints are recorded for the one debt 

The Bureau simply accumulates all complaints submitted by consumers without considering the 

nature of the complaint and without regard to its accuracy or legitimate characterization as a 

complaint against a debt collector. The result is an aniflcially inflated amount of ccmplaints 

against the debt collection industry which the Bureau continues to represent as the most 

complained about market. 

6 

B. The Lack ofStaJIIIOJY Awhoriry to Publish Consumer Complllilll Data 

Although two provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act 

(Dodd-Frank Act) require the Bureau to repon annually to Congress about the number of 

consumer complaints in general, 

1 and to repon semi-annually to the President and designated 

congressional committees, cenain analyses of the complaints the Bureau has received and 

collected in its databases from the prior year.8 However, nothing in either section of the statute 

3 CFPB, Conswner Complaint Databas<. as of Deccmb<r 20 t 7 ami/able at hnesti"" w.ronsun>erfon;mce.sov/daL1· 

rcsearclllwumg-comolaintsl. 'i{);!; Adams, PhD. Dire<t<>r of Research. t\C1\ International, A R<rieM" of Deb1 Collection Compfaims St~bmiltflilo 

the Constuner F;,1onciall'rotection Bt~reou's Complaint Databose in1011. ACA lntemaJional White Pap<~ 

(January 20 18), arai/ab/e a1 httos1/II\\\\.3CaintemaJion:tl.orglasset<lres<arch-statisticslaea-wp.romplainlS·reviewt017.pdf. 

CFPB, Co11Sum<r Response: A Snapshot ofCcmplaims Recei•~d (July 20t4). muilabfe at 

ttos11foles.eonsumerfinanoe AAv tl201~7 cf!!b report wnsumer-cgmpt•int-snaosho!.pdf. Josh Adams. PhD. Dir«:l()T of Research. ACA International. A R<~·iew of Debt Collection Compfaims Submilled to 

the Consumer filltmcial Prmmion Burtau s Complaim Database ill 1017. ACA lntcmaJional White Pap<r 

(January 2018~ mYJilable 01 hllps:!Jw\\w.aeaintemaJional.orglassetslrestareh-stl!istieslaea-llp<9!!!plainJS-review. 

1017.pdf. 

12 u.s.c. 5493(bX3XC). 1 12 U.S.C. 54%(eX4). 

3 
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aUihorizes the Bureau to make the consumer complaint database public. The publishing of 

inaccurate and unverified infomtation aoout any debt collector results in reputational hannthat 

cannot otherwise be reve~ed. It also misleads consume~, which could lead to unfounded 

concerns aoout engaging with the collections industry, despite that this engagement is often 

essential to preserve credit options and avoid other problems that result from unpaid debt. One 

academic called the complaint database a "government sponsored Yelp."

9 

Analyzing complaint data on a broad scale and highlighting trends appears 10 fulfill the 

Bureau's statutory ma11date; public shaming does not. As the complaint database and its utility 

is revaluated going forward, we ask that Congress work closely with the BCFP to ensure that it 

is being used in way in which true concems are collected and addressed, not as a public 

relations tool to punish disfavored industries. The credit and collection industry is deeply 

interested in dentif)~ng true complaints and problem actors to weed out any bad practices, but 

the current process and reporting for the complaint database is not effectively doing that. 

Ill. More Transparency and Due Proce$s Should be Included in BCFP 

Enforcement Processes 

To fitlfill its statutory mission and obligations properly, the Bureau must strictly adhere to fair, 

clear, and transparent enforcement processes and practices. Too often in the past, the Bureau's 

actions have fallen short of these standards. Many who have been the subject of enforcement 

actions view the experience as a one-sided imposition of the Bureau's interpretation of the law, 

with finns lacking effective recourse to put forward a contrary view and, more often than not, 

pressured into seuling to avoid the high cost of contesting the allegations. This sense of pressure 

is particularly strong for small businesses that lack the resources for dealing with an opaque, 

protracted, and unresponsive process. 

Concerns are widespread aoout the Bureau's practice of characterizing conduct as an unfair, 

deceptive, or abusive act or practice ("UDAAP") without prior notice, and then holding other 

businesses accountable under this retroactive interpretation of legally required or proscribed 

behavior. Moreover, it remains unclear how the Bureau defines UDAAP, 11~1h the "unfair" prong 

continuing to be a particularly subjective matter for individual enforcement attorneys and 

examiners. Objections on fairness grounds to an enforcement action that faults a business for 

conduct in the past that was legal at the time have fallen on deaf ears. Other concems relate to the 

Bureau's poor record on communications during the enforcement process. Overall, because of 

the Bureau's often agenda-driven rulemaking through enforcement approach, businesses sufler 

from a lack ofkno11~ng what is expected and reqnired of them. Congress should not only 

consider providing statutory clarification to the Bureau's UDAAP authority but also work to 

ensure that the enforcement process is fair, effective, and includes due process going forward. 

' Assessing the Effects ofCOIISIImer fillallciallnformation. Before tht. S. Comm. On &mk•itg. Ho11Si11g, and Urban 

Affairs. (AprilS, 2016)(Statement ofT odd Z)"licki, George Mason Unil·mity Foundation Professor of law 

Antonin Scalia School of law at George Mason Unil'mity. E.xecuti1·e Director. law and Etenomics Center). 

m·ailable 01. https11Miw.hanking.senate.go,·nmwm«<ialc!odl"'icki%20futimon'<'fo204·5·16.pdf. 

4 
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IV. We Appreciate the RFI Process and Willingness to Consider Input from 

Industry and Consumer Groups 

Good policymaking does not derive when those writing and enforcing the rules have preconceived notions, lack transparency, and are agenda dri1·en. While the consumer perspective is 

critically important, it is also essential to consider diverse perspectives and real-world in house 

experience of those act~ally providing products and services to consumers. We appreciate the 

steps the Bureau has recently taken under the leadership of Acting Director Mulvaney to improve 

the Bureau's processes and receive broader and more infonned input. Included in this is the 

ongoing robust eflort to compile feedback through Requests for lnfonnation (RFI). Tile 

comprehensive RFI's should be used to improve upon pre1dous practices. As a brand new 

agency, it is understandable that the Bureau is learning as it goes, and should use the new 

leadership as an opportunity to make improvements in a bipartisan way. 

As previously outlined, the credit and collection industry provides a valuable sen•ice to the 

functioning of the economy, employs thousands of Americans throughout the country, and can 

help consumers resolve a less than ideal financial problem. It is important that the Bureau worl<.s 

to understand how it can help provide clarity surrounding rules for the industry and support the 

work of the industry, which will ultimately also benefit consumers. Specifically, it is essential 

that the pennanent Director of the BCFP use the infom1ation collected during the RFI process to 

create a clear and not unnecessarily Ol'erly burdensome operating environment for those 

participating in the financial sen•ices marketplace. ll1is includes not creating one-size-fits all 

policies that disproportionately harm small businesses. 

V. BCFP Legislation ACA Supports 

As Congress looks to the furure of the BCFP, there are common sense changes that can be made 

to impro"e its structure and operations. Accordingly, we recommend that the following pieces of 

legislation are enacted into law. 

• Consumer Financial Protection Board Act, S. lOS and The Financial Protection 

Safety Commission Act of2018, H.R. 5266 

These companion bills would create a five member, bipartisan commission at the Bureau. It 

would ensure certainty and stability in financial services regulation for America's consumers, 

small businesses, and the economy. In contrast, a sole director structure at the BCFP creates a 

whipsaw eOect in financial sen•ices regulation, making it difficult for financial sen•ices 

organizations from being able to create long term business plans, im·est in new products and 

sen•ices, and best sen•e their consumers. Having a multi-member commission will increase 

transparency at the Bureau and allows for input from multiple stakeholders. Robust debate 

with multiple viewpoints is more likely to strengthen consumer choice and the ability for 

consumers !o access credit 

• Consumer Financial Protection Bureau Accountability Act, S.387 

Til is bill amends the Consumer Financial Protection Act of2010 to change the source of 

funding for the BCFP from Federal Reserve System transfers to annual appropriations. This 

is appropriate because it adds checks and balances and allows consumers through their 

elected officials to have a voice in the direction of the Bureau. Til is is particularly important 

to add transparency and accountability to the single director structure, which currently 

answers to no one. 
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• GUIDE Compliance Act, H.R.SS34 

The Gil•e Useful Information to Define Effective Compliance Act C'GU!DE Compliance 

Act") would require the Bureau Director to "issue guidance that is necessary or appropriate to 

enable the Bureau to cany out Federnl consumer financial law, including facilitating 

compliance with su(h law." Often an entity seeks guidance from a regulatory agency because 

a critical issue arises that requires explanation. This may be within lhe oourse of litigation or 

pending litigation, or necessary for on-going compliance, and time is of the essence. 

Furthermore, oourts often give deference io guidance, which provides further support for 

their utility. Scenarios arise that sometimes are overlooked in the oonsiderntion of a rule. 

Industries change, and in the case of the debt collection marke~ technologies may provide 

enhancements to standard procedures. This may assist in the development of best prnctices 

and could allow regulators to assess the effectiveness of the current rule. 

Thank you for your attention to these important concerns. We look forward to continuing our 

engagement 11~th the Senate Banking Committee and the new leadership at the Bureau about 

issues that are important to the credit and collection industry. 

Sincerely, 

MarkNeeb 

Chief Executive Ofticer 

6 
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July 17,2018 

The Honorable Mike Crapo 

Chairman 

Comminee on Banking, Housing, and Urban Affairs 

United States Senate 

Washington, DC 20510 

Dear Chairman Crapo and Ranking Member Brown: 

The Honorable Sherrod Brown 

Ranking Member 

Comminee on Banking, Housing, and Urban A flairs 

United Stares Senate 

Washington, DC 20510 

On behalf of the American Financial Sm;ccs Association' (AFSA), Iam IITiting in strong suppon of President 

Trump's nomination of Kathleen "Kathf' Kraninger for the Director of the Bureau of Consumer Financial 

Protection (BCFP) position. 

Ms. Krauinger is an excellent ~hoice to lead the Bureau and to continue Mr. Mulvaney's pragmatic, measured 

approach to ensuring that consumers benefit from safe, afiordable products pro,•ided by the most responsible 

members of the consumer credit induStr)'. 

Ms. Kraninger's extensi,•e background in increasingly responsible positions of leadership in the federal 

government, especially her present position ofOOice of Management and Budget's Associate Director for General 

Government, makes her an excellent choice as the next Director of the Bureau. 

In her present role Ms. Kraninger oversees the budget development and execution for a number of executive branch 

agencies, including the Oepa11mems of Commerce, Treasury and Housing and Urban Development. This gives her 

the experience. the executive management expenise, the fiscal management and responsibility, and the fresh 

perspec.tive needed to lead a large federal agency. 

Since its inception, the BCFP has had extraordinary authority over all face.ts of the consumer credit industry. The 

director of the Bureau needs to ensure certainty, fairness, and transparency. Kathy Kraninger will be a strong and 

eftective leader for the BCFP, and I encourage you to act quickly to con finn her nomination as Director. 

Thank you for your auention to this maHer. 

Sincerdy, 

fi#l* 

Bill Himpler 

Executive Vice President 

American financial Services Association 

cc: Members of the Banking, Housing, and Urban Affairs Commiuee 

1 Founded in 1916, AFSA is 1he n3lionallrnde ossociation for lhe cons1uner ct1.'di1 indus1ry, prolecting ac«SS 10 credit and 

consumer choice. AFSA members pro,·ideconsumcrs with many kinds of credit, including dirt'Ct and indirt->el \"Chicle 

finan<ing. tradilional installment oa ~ mongages. p3)1nent cards, and re1ail sales finance. 

919 18' Street NW Su1te 300 Washmgton DC 20006 I (202) 296-5544 I ~ I @AFSA_DC 
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The Honorable Mike Crapo, Chairman 

Senate Committee on Banking, Housing and Urban Affairs 

534 Dirksen Senate Oflice Building. 

Washington, D.C. 20510 

The Honorable Sherrod Brown, Ranking Member 

Senate Committee on Banking, Housing and Urban Affairs 

534 Dirksen Senate Oflice Building. 

Washington, D.C. 20510 

Dear Chairman Crapo and Ranking Member Brown: 

I write in support of Kathleen Kraninger for the position of Director of the 

Bureau of Consumer Financial Protection. Throughout her time in public service, 

Ms. Kraninger has been a steward of taxpayer and government accountability, gaining 

experience by leading teams within multiple federal agencies. 

With the creation of the Bureau as a result of the Dodd-Frank Act, its structure 

allowed the agency to shield itself from nearly all accountability or taxpayer oversight. 

It's first and former director under the previous administration demonstrated how a 

Jack of transparency can lead to mismanagement of resources, an activist regulatory 

agenda and courts ruling its structure unconstitutional. 

Under the leadership of current BCFP Acting Director and Director of the Office of 

Management and Budget Director Mick Mulvaney has emphasized Bureau 

accountability and focused on enforcement measures that punish bad actors, while 

protecting consumers financial choices in the marketplace. I am confident Ms. 

Kraninger will continue to put the interests of consumers ahead of political ideology. 

Americans for Tax Reform praises this nomination as an imponant stride toward 

reversing the harm that regulatory burdens have inflicted on the very consumers it was 

created to protect under the authority of the pre1~ous Director. As President of 

Americans for Tax Reform, I share the same concerns of House Financial Services 

Committee Chairman Jeb Hensarling that 11~thout proper leadership and change, the 

Bureau will continue to operate as prosecutor, judge and jury, depriving legal 

businesses of proper due process. Thankfully, President Trump has nominated a 

candidate that has a proven record of government management experience. 

Since its founding, the Bureau has regulated through enforcement and created an 

environment that Jacks oversight and certainty, putting consumers funher out of reach 

from afforda!'ble financial products. Ms. Kraninger's nomination is a step in the right 

direction toward providing transparency at the agency. I encourage you to support her 

confirmation as Director of the Bureau of Consumer Financial Protection. 
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Sincerely, 

~/tr 

Grover G. Norquist 

President 

Americans for Tax Reform 
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July 16,2018 

Chairman Mike Crapo 

Senate Comminee on Banking, Housing and Urban Affairs 

534 Dirksen Senate Oftice Building 

Washington, D.C. 20510 

Dear Chairman Crapo and Members of the Committee: 

On behalf of the undersigned organizations and the millions of Americans we 

represent, we are pleased that you will soon be considering the nomination of 

Kathy Kraninger, an advocate <Of pro-consumer and pro-taxpayer accountability 

reforms at the Bureau of Consumer Financial Protection (BCFP), for the position 

of Director of that Bu.reau. Many of us continue to believe that BCFP is an 

unnecessary e)ltity and that consumer protections could be strengthened through 

other means. However, at the very least it is impor1ant to ensure that BCFP's 

future leadership is aware of the need for fundamental change. 

Kathy Kraninger has a strong background and the necessary qualifications in 

orderto lead and improve the BCFP. In her current role at the Oftice of 

Management and Budget, she monitors over $250 billion in spending for sel'en 

cabinet depar1ments and 30 agencies. The budgets for the BCFP, Depar1ment of 

Treasury, HUD, and all other financial regulators fall within her purview, which 

gives her first-hand knowledge of the financial regulatory system. Further, her 

more than two decades of leadership and management experience in public 

service complements her insight into the federal bureaucracy. 

It is no secret that the BCFP has been flawed since its creation in 20ll.lts 

current structure is broken, its <Operations are far from transparent, and its unique 

funding scheme insulates it from Congress, the President, and the American 

people. While it does not receive direct funding from taxpayers, the agency does 

siphon funds that the Federal Reserve would otherwise send to the Treasury. 

Furthermore, BCFP's regulatory interactions 11ith other agencies can affect 

programs 11ith an impact on taxpayers and the greater marketplace as a whole. 

Its power is so massive US District Court Judge Loretta Preska of the South 

District of New York ruled that the CFPB "lacks the authority to bring this 

enforcement action because its composition violates the Constitution's 

separation of powers." 

Thankfully, acting-Director Mulvaney has initiated important refom1s to the 

Bureau's day t~ay activities, rule analysis, and aciS within iiS statutory 

authority instead of as an activist regulator under the previous administration. 

This process must continue, and we are confident that Ms. Kraninger is 

eminently capable of doing so. We thank the Committee for considering our 

views and for acting in a timely fashion. 

Sincerely, 

Pete Sepp, President 

Nalional Taxpayers Union 

NTrJ NAIIONAlTAXI'IIYERS UNION 

A}AERICANS JrJffAXREFORM 

• Independent• 

Women's Voice 

FAMILY BUSINESS 

COALITION 

TAXPAYERS 

PROTECTION 

AL LIANCE 
157 


71918311.eps

Grover G. Norquist, President 

Americans for Tax Refom1 

Karen Kerrigan, President & CEO 

Small Business & Entrepreneurship Council 

Heather R. Higgins, CEO 

Independent Women's Voice 

Palmer Schoening, Chainnan 

Family Business Coalition 

David Williams, President 

Taxpayers Protection Alliance 

Rick Manning, President 

Americans for Limited Govemment 

George Landrith, President 

Frontiers of Freedom 

Amy Kremer, Co-chair 

Women for Tnnnp 

Andrew F. Quinlan, President 

Center for Freedom and Prosperity 

James L. Martin, FounderfChairrnan 

60 Plus Association 

Saulius "Saul" Anuzis, President 

60 Plus Association 

Steve Pociask, President 

American Consumer Institute 

Jenny Beth Martin, Honorary Chainnan 

Tea Party Patriots Action 

~) FR NTIERS of 

T FREEDOM 

Smning rhr Mmi"t' ofPbm) 

ACI 1heAmerican Consumer Institute CenterforCitiun Resw<h 

· TEA PARTY PATRIOTS ACTION 
158 


71918312.eps

(t\ Credit Union ll National 

cuNA Association 

July 18, 2018 

The Honorable Mike Crapo 

Chainnan 

Committee on Banking, Housing and Urban 

Affairs 

United States Senate 

Washington, DC20510 

JimNus~e 

Pre!idenf&CEO 

99MSW!els.!: 

~e300 

WO!IIilgl""OC:Im)3.JI99 

The Honorable Sherrod Brown 

Ranking Member 

Committee on Banking, Housing and Urban 

Anairs 

United States Senate 

Washington, DC 20510 

Dear Chainnan Crapo and Ranking Member Brom1: 

On behalf of America's credit unions, I am writing today to thank you for holding a nomination hearing for 

Ms. Kathleen Kraninger to be the next Dirt'Ctor of the Bureau of Consumer Financial Protection (BCFP or 

Bureau). Credit Union National Association (CUNA) represents America's credit unions and their II 0 

million members. 

Since the resignation of Director Richard Cordray in November 2017, the Bureau has been led on an interim 

basis by Acting Director M[ck Mulvaney. In his dual role, Acting Director Mulvaney has introduced several 

initiatives intended to reform the BCFP's approach toward regulated entities and reconnect the Bureau with 

its original mission: "(aiming] to make consumer financial markets work for consumers, responsible 

providers, and the economy as a whole." Credit unions thank Acting Director Mulvaney for his service to 

the Bureau and the nation's consumers. 

Stability of leadership and clarity of mission are critical features of any efticient and effective regulatory 

body. For that reason, CUNA welcomes the nomination of a pem1anent Director to the BCFP and urges the 

U.S. Senate to take swift action to resolve the unsettled nature of the Bureau's future. Cre-dit unions look 

forward to working with a new pem1anent BCFP Director, one that we hope will recognize the unique 

structure of credit unions and the enormous benefit credit unions provide to American consumers in need of 

financial services. 

While the nomination of a pennanent leader is a positive development, we continue to believe the best path 

forward for the Bureau is for Congress to enact legislation providing for a multi-person, bipartisan 

commission to lead the Bureau, as was originally proposed by the Obama administration in 2009. 

Proponents of the Bureau have historically hailed it as a regulatory agency with an obligation to fairly and 

independently administer federal consumer protection law. However, the current strucrure has proven to be 

the Bureau's fatal flaw and has resulted in an agency that is only independent from the minority political 

party. The Bureau's history heretofore suggests the Bureau has extraordinary political dependence that will 

almost certainly lead to wild swings in rulemakings, supervisory practices and enforcement policies if the 

Bureau's strucrure is not addressed by Congress. And, the extent to which the Bureau lacks the political 

cuna.org 
159 


71918313.eps

independence its mastennin.ds sought will be crystal clear in the statements and questions raised at this 

hearing. 

Consumers deserve better than the political bureau Congress has established. Only through the appointment 

of a bipanisan commission will the Bureau have the type of independence that proponents herald and the 

steady approach to regulation that consumers and regulated entities need. We appreciate that legislation has 

been introduced in both chambers encourage Congress to address this fatal Oaw and look forward to working 

with you on this matter. 

In the meantime, consumers and regulated entities will be best served by a Senate-confim1ed, pennanent 

director leading the Bureau. We appreciate the president having nominated Ms. Kraninger to this position, 

and we urge the committee to give her nomination full and fair consideration. 

On behalf of America's credit unions and their 110 million members, thank you for your consideration of our 

views. 

Sincerely, 

cuna.org 
160 


71918314.eps

!DENT CoMMUNITY 

BANKERS of OORlCA® 

July 18,2018 

The Honorable Mike Crapo 

Chairman 

Committee on Banking, Housing, 

& Urban Affairs 

United States Senate 

Washingion, D.C. 20510 

limolhy K. Zimme<mon, Chairmen 

Ptell<ln l KeMecly, ChoilmonfJed 

Nooh W. Wilcox, V'"" ChoiJmon 

Koiuyn ~-.ood. Treowter 

a.. Jc<don. s.c-y 

R. &011 Hel\omp, lmmedicle PosJ Chairmen 

Rebeco Rome<e Rainey, Pre.idem end CEO 

The Honorable Sherrod Brown 

Ranking Member 

Committee on Banking, Housing, 

& Urban Affairs 

United States Senate 

Washington, D.C. 20510 

Dear Chairman Crapo and Ranking Member Brown: 

On behalf of the nearly 5,700 community banks represented by ICBA, I write to thank you for 

scheduling a confirmation hearing for the nomination of Kathleen Kraninger to serve as Director of the 

Bureau of Consumer Financial Protection (Bureau). 

Ms. Kraninger has a distinguished career in public service. She is currently Associate Director for 

General Government at the Office of Management and Budget (OMB), where she oversees numerous 

cabinet and other federal agencies, including the Bureau and all of the other financial regulatory 

agencies. 

At OMB, and in prior jobs at the Department of Homeland Security and the Department of 

Transportation, Ms. Kraninger has demonstrated her talent for agency management and policymaking 

oversight. She has testified before Congress on multiple occasions. Her experience wolking as senior 

staff for different congressional committees will help her manage the Bureau's relationship with 

Congress, a major part of the Director's job. 

Having met Ms. Kraninger, I believe she understands the critical role played by community banks in 

creating access to consumer and small business credit and supporting prosperity in American 

communities. This perSpective will strengthen the Bureau's rulemaking.l also believe she has a strong 

commitment to making the Bureau accountable, effective and efficient. 

Finally, I would like to emphasize the importance to community banks and to consumers of confirming 

a permanelll Director of tbe Bureau. There are numerous important regulatory initiatives in the Bureau's 

pipeline that will benefit from the consistent vision provided by a permanent Director. Community 

banks deserve to have long-term expectations and policy certainty as they undertake business planning 

that "ill allow them to better serve their communities. 

The Nation's Voice for Community Banks.e 

WASHNGT<»>,OC 

1615lS. ... t-M' 

S..Je«Xl 

OC20036 

SAtA< <lNTRE, MN 5181iocdr>Rood 

P08o:c 267 861>8434122 

So* C..... NN 56378 w.w.<loc.org 
161 


71918315.eps

I believe that Ms. Krnninger would make an excellent Director of the Bureau of Consumer Financial 

Protection and urge you to mark up her nomination at the earliest opportunity. 

Thank you for your consideration. 

Sincerely, 

Is! 

Rebeca Romero Rainey 

President & CEO 

CC: Members of the Senate Banking Commillee 

The Nation's Voice for Community Banks.fl WASIII>IGTCtl, 0C 

161SlSireecNN 

Soi>l900 

w~ OC20036 

SAij( CENTRE, Mi'l 

SIS Uncolnfood 

10 BoK 267 866843-lm hl C...e, WN 56378 w.w.kbo.ag 
162 


71918316.eps

July9, 2018 

The Honorable Mike Crapo 

Chair- Senate Committee on Banking, Housing and Urban Affairs 

239 Oitksen Senate OffiCe Building 

Washington. D.C. 20510 

The Honooble Sherrod Brown 

INTERPORTPOLICE 

JayB,Grant 

Secreta"! General 

ONE WORlD TAAllE CENIEO,llliTE 8100 

NEW YO>\( NY 10007 

1:111110.6201 

:jl'(.sRnt@lin,~poiU.or& 

'"""""""'"""' .... ""' 

Ranking Member-Senate Committee on Banldng, Housing and Urban Affairs 

713 Hart Senate Off~e Building 

Washington, D.C. 20510 

Membefs of the Committee; 

Dear Senators, 

I am wr~ing you in regards to Kathleen Kraninger, the Presidenfs nominee to head the Consumer Finane~! 

Protection Bureau. I have WO<ted i)lofessionall)r with Kathy for well ~er a ~ecade and know her well. She~ a 

person of high integr~. wea i)loYen as a leader and an excenent manager. She is dmgent in her ethics, \VOlt 

product and efforts, has always been forthright, and exceeds expeciat~I\S. 

In my worl< with her I have experienoed how she excels in non·part~n collaboration with a goal of getting the 

job done and ouhiYates a healthy working re~tionship and environment. When dealing with leg~lation and 

policy, she administers great skill to ensure issues are addressed timely and equitably, understanding the needs 

and the requi!eme<lts of protectio1g our Nation and those individuals affected. You will find her highly respected 

among peers and Members of Col181ess who know her. 

Kathy~ first among many, the type of person you want in government and one you can deal with honestly. I 

would ask you not to i)le·judge her, you will find her knowiedgeab~, rompassionate, and ectremely rompetent. 

Kathy is her own person, has great respect for Congress, and our citizens. She ~ a person who ~ honorable, 

extraordinal'f and od~tinguished and wil address her obligations in an equitable manner, ensuring the elements 

of the Bureau to empower, enforce, and educate are met. 

Please offer her yoor honest oonsideration and t enoourageyou to move her nomination forward. 

~ 19&9, bw ttlf«ttiTlel"'lae,tneies "¥~'01li"casag'.(l!»> [OtCton tr.wnartONI Wtfltorism cti'otto tmurttl'tt pubk.sa~of 

fl"""'ffl, Wl<Jpplrcll>l>.•od<ri!Oiinlmullcwtt-~~ 
163 


71918317.eps

CHAMBER OF COMMERCE 

OF THE 

UNITED STATES OF AMERICA 

NEILL. 8 RAOL£\' 

f:.n:et:nn: YJCI: PUSII>h\ T & 

CHIEt- POI.IC\' OttiCU 

The Honorable Mike Crapo 

Chair 

Committee on Banking, Housing, 

and Urban A flairs 

United States Senate 

Washington, D.C. 20510 

July 17,2018 

1615 II STIEET. N\\" 

\\"".\~IU~GTO\. 0( 20062 

(202) -163-iJIO 

The Honorable Sherrod Brown 

Ranking Member 

Committee on Banking, Housing, 

and Urban A flairs 

United States Senate 

Washington, D.C. 20510 

Dear Chairman Crapo and Ranking Member Brown: 

The U.S. Chamber ofConunerce urges the Committee to report the nominations of 

Kimberly Reed to serve as President of the Export-Import Bank of the United States (Ex-lm) and 

Kathleen Kraninger to serve as Director of the Bureau of Consumer Financial Protection 

(Bureau). 

Ex-lm has not be-en fully functional since its charter was allowed to lapse on July I, 

2015. Failure 10 confirm nominees to the Board after their tenns expired last Congress and 

additional expirations at the start of this Congress have resulted in Ex-lm not having a single 

Senate-confinned leader on its five-person board. There are currently $37.5 billion in pending 

IT3JJ>actions that require approval from the Ex-lm Board--1hat is, $37.5 billion in high-quality, 

"made in the USA" products that could be sold to customers around the world simply by having 

at least three board seals filled. 

Additionally, C.ongTL'SS has acted to reform the Bank, but these reforms ha1•e been largely 

stymied by lack of a quorum of the Board. In 2015, superrnajorities of the House and Senate 

demonstrated crystal clear congressional intent to keep a fully functioning Ex-lm Bank, and they 

also advanced important reforms to the agency. Chief among those reforms was a requirement 

for Ex-lm to appoint a chief ethics oflicer and a chief risk officer. Unfortunately, both of these 

appointments require approval by a quonnn ofEx-lm's Board and, therefore, have not been 

exe<:uted. 

Since the early 1990s, Ex-lm has generated $7 billion in revenue above its operating 

costs and returned these funds to Treasury, making this a government program that is not only 

smart for business, but also a victory for taxpayers. Preventing Ex-lm from approving large 

de.1ls and, in tum, collecting the associated fees for those deals could make 2018 the first year 

that Ex-lm stops being self-suflicienl. This could funher endanger the remaining functioning 

programs at the Bank, such as products aimed at supporting small exporters. 

We believe that Ms. Reed will uphold the critical mission ofEx-lm while providing 

much needed improved governance of the agency. In addition, it is long overdue for the full 
164 


71918318.eps

Senate to take up the nominations of Claudia Slacik, Judith Delzoppo Pryor, and Spencer Bachus 

to serve on Ex-1m's B()ard, which have already been favorably reponed by the Commiuee. The 

Senate should expeditiously restore a working qu()rum to this critical tool tor America's 

exporters. 

Ms. Kraninger has experience in both the legislative branch and the executive branch. As 

the current Associate Director for General Government at the Qfllce of Management and Budget, 

Ms. Kraninger oversees the budget and management for a number of executive departments and 

Federal agencies, including the Bureau and other financial regulators. This type of budgetary and 

managerial experience is essential to preparing the Bureau for long-term success. 

Since its creation, the Bureau has been beset by managerial shortfalls and has not been a 

traJlSparent agency. Ms.. Kraninger's experience would serve her well as the Director of the 

Bureau, especially as it aims to be a more transparent and accountable agency. 

The Chamber thanks you for considering these important nominations. 

Sincerely, 

J;Wi~ Neil L. Bradley 

cc: Members of the Senate Committee on Banking, Housing, and Urban Allairs 
165 

DOCUMENTS SUBMITTED IN SUPPORT OF THE NOMINATION OF 

KIMBERLY A. REED 


71918319.eps

ErieK.faMing 

Pr~l"GQI.ef~Oil'.w 

July 16,2018 

The Honorable Michael Crapo 

Chaim1an 

Committee on Banking, Housing and 

Urban AllaiJS, United Scates Senate 

Washingcon, D.C. 20510 

AEAOSPACE INOUSfRIES 

ASSOCI.O(f.,., 

The Honorable Sherrod Brown 

Ranking Member 

Committee on Banking, Housing and 

Urban Affairs, United States Senate 

Washingcon, D.C. 20510 

Dear Chainnan Crapo and Ranking Member Brown: 

On behalf of more than 340 AlA member companies, and the 2.4 million workeJS in the aerospace and 

defense industry, I am \\Tiling to express our strong support for the confinnation of Kimberly Reed as 

President and Chair of the Board ofDirectOJS of the U.S. Export-Import Bank. The Bank helps level 

the playing field for U.S. exporters, creates new opportunities for U.S. companies and strengchens our 

strategic relationships throughout the world. Ms. Reed's nomination could not come at a more 

important time. 

Ex-lm has been unable to approve transactions greater than S 10 million without a quorum on its Board 

of Directors since late 201 S. More than $40 billion in U.S. exports are waiting on Ex-lm Board 

approval that can' occur without action from the Senate. The Bank estimates that this would support 

approximately 250,000 American jobs. The 2.4 million U.S. jobs in the aerospace industry depend on 

trade and an international supply chain. Ex-lm support is needed to grow our industry's $86 billion 

trade surplus. 

The global market is fierce!)• competitive and the United Scates "111 need every set oftools and trade 

policy measures at its disposal to level the playing field and contend for export opportunities. Other 

countries use their own Export Credit Agencies as a tool to boost exports; we are at a severe 

disadvantage without a fully operational Bank of our 01111. 

In her previous confim1ation hearing as nominee for Vice Chair ofthe Bank, Ms. Reed demonstrated a 

clear understanding of the critical support that the Bank provides American manufacturers. Her 

extensive experience and background in finance and trade make her an excellent choice to lead the 

Bank. Combined with a quorum ofDirectors on the Bank's Board, her leadership would enable 

implementation of Congressionally-mandated refonns that have stagnated since 2015. 

Kimberly Reed's nomination passed through the Banking Committee previously with broad bipartisan 

support. We also urge the confinnation of Spencer Bachus, Claudia Slacik and Judith Delzoppo Pryor 

as Directors on the Board, which would restore the Bank to full functionality. 

We urge you to move swiftly toconfimt Ms. Reed as President and Chair of the Bank and the other 

Ex-lm Bank nominees. 

Sincerely, 

Aerospace lndusttiesAss«:iatioll Of America. Inc. 

1000W::son8otPe-I001.Suitel100 Arfitle0ti.YA22209-3928 (103lJ5S.1000 v.·ww.a~ 
166 


71918320.eps

July6, 2018 

The Honorable Michael uapo 

Chairman 

Sen.lte Committee on 8an~ing. Housing and Urban Affairs 

The Honorable Sherrod Brown 

Ranking Member 

Sen.1te Committee on 8an~ing. Housing and Urban Affairs 

Dear Olairman Crapo and Ranking Member Brown: 

As representatives of the production agriculture and food community, we are pleased to write in support of the 

nomin.Jtion of Kimberly Reed as President of the E)(j)Ort·lmport Bank of the United States of America. 

All or almost all the organiz .. tions signing this letter, signed a ~milar letter to you last fall in support of Ms. Reed's 

nomination to be Vice Chair of the Export-Import Bank. MtKh of what has transpired in the world over the past 9 

months or so has created great uncertainty for trade, and Ms. Reed can be an even more important force for the 

U.S. position. 

As has been previously stated, Ms. Reed's career experience in both finance and food & agriculture make her an 

excellent selection to help I ead this important organization at a time when U.S e)(j)Orters need every asset pos~ble 

to compete in the global eoonomy. Kimberly Reed has served in the office of the Secretary of the Treasury and as 

Director of the Community Otlvelopment Financial institutions Fund. In the food and ag sector, she served many 

years as the President of the International Food Information Council Foundation, helping develop and deliver 

science-based, effective communications strategies connecting the food ind.,try and production agriculture with 

consumers, scienti.sts, journalists and other stakeholders. Importantly, in this role, her duties were not only 

domestically focused--she expanded the role to build global understanding and educate policy makers, multi· 

lateral and diplomatic officials, and key stakeholders around the world. 

In the end, she, wor1<ing with the U.S. Government and Embassies, fostered a positive environment at the highest 

levels in emerging marl<et countries for U.S. e)(j)Orts.lf confirmed, she will bring this same passion and 

commitment to the Export-Import Bank of the United States to make a positive difference lor U.S. companies and 

workers. 

Ms. Reed has a strong agriculture networl< across the nation. Among her supporters are numerous Governors, 

State Secretaries of Agriculture, and ag industry leaders. 

We see Ms. Reed as uniquely qualified to step in and lead the Ex·lm Bank at a pivotal time for the Bank and 

American bu~ness-indudi ng the agricultural sector. We encourage you to give her a swift and positive hearing 

and confirm her nomination. 

Sincerely. 

Daren Coppoclc, Pre~ ent & CEO, Agricultural Retailers Assa<iatian 

Vincent Duvall, Pre~dent, American form Bureau federation 

Patrick Arcller, President, American Peanut Council 

Andrew LaVigne, Pr~dent & CEO, American Seed Trade Association 

Gary Van Sickle, ExecutiYe Director, California Specialty Craps Council 

John Bode, President & C!O, Cam Refiners Association 

Jay Vroom, Pr~dent & CEO, Craptife America 

Barbara Glenn, CEO, Notional Association of State Departments of Agriculture 

Olandler Goule, CEO, National Association of Wheat Growers 
167 


71918321.eps

Kendal Frazier, UO, National Cattlemen's Beef A$$/Xiation 

Michael Brown, re~ ent, National Chicken Council 

Cllris Nova!<. CEO, Notional Corn Growers Association 

Gary Adams, re~dent & CEO, National Cotton Council 

Charles Conner, President & CEO, National Council of Former Coaperotiv<> 

Neil Oierks, UO, National Parle Producers Council 

Tim lust, CEO, National Sorghum Producers 

Betsy Ward, President & C£0, USA Rice Federation 
168 


71918322.eps

July 3, 2018 

Hon. Mike Crapo 

Chairman 

Comminee on Sanking. Housing and Urban 

Affairs 

US Senate 

Washington DC 

Dear Mr. Chairman and Senator Brown: 

Hon Sherrod Brown 

Ranking Member 

Committee on Sanking. Housing and Urban 

Affairs 

US Senate 

Washington DC 

I write in support of the nomination of Kimberly A. Reed for President of the Export-Import Sank. 

Ms. Reed has a record Clf achievement in both the public and private sector. The CDFI Coalition 

came into contact with Kimberly in her role as Director of the Community Development Financial 

Institutions (COFI) Fund. During her tenure at the fund Ms. Reed implemented loan, grants and 

tax credit programs for underserved and economically distressed rural and urban communities. 

She was a careful and responsible administrator, listened carefully to stakeholders and a !ways 

acted with integrity. 

K1mberly Reed's career has all the hallmarks of success. She has not only advanced to positions of 

increasing responsibility, she has also been a volunteer board member for important issues and, is 

the first women Chair of the National Republican Lawyers Association Board of Governors. 

Kimberly Reed's education, record of career success makes her well qualified for the position. 

More important, she is an outstanding person and we are sure she will do a great job leading the 

EXport-Import Bank. 

Sincerely, 

Dominik Mjartan 

Chairman 

1331 G Street NW 10th FlOor Wasn1ngton. OC 20005 • 202-393·5225 I'IIIWcdli org 
169 


71918323.eps

SHtllEY MOORE CAI'ITO 'M'Sr\tllii.\• 

tlnitrd ~ta es ~cnatc WASHINGTON, 0C 20510 

July 19,2018 

The Honorable Michael Crapo, Chair 

Committee on Banking, Housing, and Urban Affairs 

The Honorable Sherrod Brown, Ranking Member 

Committee on Banking, Housing, and Urban Affairs 

Dear Chairman Crapo and Ranking Member Brown: 

cx:».••~.fFa, sar.-.a. ANOIRANSI'OIIIATION 

ENVIIIONM<NT ANOPU8liCII'O'KS 

RULES A.\'llAilMJNISTRAil().• 

I write 10 express my suppon for the nomina1ion of Kimberly A. Reed to serve as Presiden1 and 

Chairman of !he Export-lmpon Bank of the United States. As the first woman and Wes1 

Virginian to lead the Bank, she would serve our nation with great distinction. She previously 

was nominated 10 be First Vice Presidenl and Vice Chairman of the Expon-lmpon Bank of the 

United States on October 3, 2017. 

One of West Virginia's finest, Kim has excelled on every front and is devo1ed to rural America 

and national small businesses. She served as Senior Advisor to U.S. Treasury Secretaries Henry 

M. Paulson, Jr. and John W. Snow, Director of U.S. Treasury Departmenl's Community 

Development Financial Institutions (CDFQ Fund. Her work resulted in nearly $4 billion in tax 

credits, loans, and grants to financial institutions and economic development groups for investing 

in economically distressed communities. 

Kim has a strong repUiation 111th Congress and domestic and international stakeholders, 

including the agriculture and eccnomic developmenl communities. She will be a credible voice 

111th our na1ion's manufacturers and wilh woman-owned businesses. Her experiences can bring 

imponant ideas and ski lis to the administration. 

Additionally, Kim serves on the Na1ional Board of Directors of the Alzheimer's Association. 

She is a 1ireless advocate for the millions of Americans with the disease, and their fifteen million 

caregivers. 

I sllongly suppon Kimberly A. Reed's nomination. Ms. Reed received a favorable vote in the 

Commince on December 19,2017. I encourage the Committee's favorable consideration again. 

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Sincerely, 

Shelley Moore Capito 

United States Senator 

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170 


71918324.eps

/(}{). llanrhild/1 

WF.sT VIRGINIA 

6/lnil«t ffktJM, ffmal.& 

WAS111NGTON. DC 

Thursday. July 12. 2018 

The Honorable Mike Crapo 

Senator Crapo. 

It is a privilege to oiTer my recommendation and suppon lor Kimberly Reed as 

Vice President of the Expon-lmpon 13ank of the United States. Kim· s dedication as a 

senior executive is c1·idcnecd by her 20-ycar career spanning numerous inlluential 

institutions. 

Kim· s deep commitment to serving her nation through the House of 

Representatives and the Department of the Treasury is a true testament to her character. 

She has continued to hone her professional experience. becoming a Vice President for an 

international financial institution in ew York. and President of the International Food 

lnfonnation Council Foundation. where she made a positive ditli:rcncc for America's 

fanners and agriculture supply chain.! know she will make the most of this opponunity 

and continue to be a positive Ioree in our government. 

Kim exemplifies bedrock Appalachian 1•alucs. and I am proud to call her a West 

Virginian.! know she will make an excellent addition to the Expon-lmpon Dank's 

leadership. and !look forward to hearing of her future success. 

!make my recommendation without hesitation and with full com·iction. 

Joe Manchin Ill 

United States Senator 
171 


71918325.eps

!DENT CoMMUNITY 

BANKERS of OORlCA® 

July3, 2018 

The Honorable Mike Crapo 

Chairman 

Committee on Banking, Housing, 

& Urban Affairs 

United States Senate 

Washington, O.C. 20510 

limolhy K. Zimme<mon, Chairmen 

Ptell<ln l KeMecly, ChoilmonfJed 

Nooh W. Wilcox, V'"" ChoiJmon 

Koiuyn ~-.ood. Treowter 

a.. Jc<don. s.c-y 

R. &011 Hel\omp, lmmedicle PosJ Chairmen 

Rebeco Rome<e Rainey, Pre.idem end CEO 

The Honorable Sherrod Brown 

Ranking Member 

Committee on Banking, Housing, 

& Urban Affairs 

United States Senate 

Washington, O.C. 205 I 0 

Dear Chairman Crapo and Ranking Member Brown: 

On behalf of the nearly 5,700 community banks represented by ICBA, !write to thank you for 

scheduling a confirmation hearing for the nomination of Kimberly A. Reed for President of the Export· 

Import Bank of the United States. 

Ms. Reed has met with the senior leadership of ICBA to discuss her background, her view of the current 

economic climate, and various issues facing community bankers and policymakers today. We are 

impressed by her experience in the public, nonprofit, and the private sectors in both the domestic and the 

international arenas, her thoughtful views on issues relevant to community banks, and her remarkable 

accomplishments. In our discussions, Ms. Reed emphasized her work experience in the small business 

sector and desire to focus on small business prosperity. Finally, we are pleased that Ms. Reed has a keen 

understanding of the role that community banks can play in supporting American exports, including the 

robust agricultural sector. 

I believe that Ms. Reed would make an excellent President of the Export-Import Bank and urge you to 

marl< up her nomination at the earliest opportunity. 

Thank you for your consideration. 

Sincerely, 

lsi 

Rebeca Romero Rainey 

President & CEO 

CC: Members of the Senate Banking Committee 

The Nation's Voice for Community Banks.e 

WASHNGTCN, OC t615tS."'NW 

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172 


71918326.eps

CHAMBER OF COMMERCE 

OF THE 

UNITED STATES OF AMERICA 

NEILL. 8 RAOL£\' 

f:.n:et:nn: YJCI: PUSII>h\ T & 

CHIEt- POI.IC\' OttiCU 

The Honorable Mike Crapo 

Chair 

Committee on Banking, Housing, 

and Urban A flairs 

United States Senate 

Washington, D.C. 20510 

July 17,2018 

1615 II STIEET. N\\" 

\\"".\~IU~GTO\. 0( 20062 

(202) -163-iJIO 

The Honorable Sherrod Brown 

Ranking Member 

Committee on Banking, Housing, 

and Urban A flairs 

United States Senate 

Washington, D.C. 20510 

Dear Chairman Crapo and Ranking Member Brown: 

The U.S. Chamber ofConunerce urges the Committee to report the nominations of 

Kimberly Reed to serve as President of the Export-Import Bank of the United States (Ex-lm) and 

Kathleen Kraninger to serve as Director of the Bureau of Consumer Financial Protection 

(Bureau). 

Ex-lm has not be-en fully functional since its charter was allowed to lapse on July I, 

2015. Failure 10 confirm nominees to the Board after their tenns expired last Congress and 

additional expirations at the start of this Congress have resulted in Ex-lm not having a single 

Senate-confinned leader on its five-person board. There are currently $37.5 billion in pending 

IT3JJ>actions that require approval from the Ex-lm Board--1hat is, $37.5 billion in high-quality, 

"made in the USA" products that could be sold to customers around the world simply by having 

at least three board seals filled. 

Additionally, C.ongTL'SS has acted to reform the Bank, but these reforms ha1•e been largely 

stymied by lack of a quorum of the Board. In 2015, superrnajorities of the House and Senate 

demonstrated crystal clear congressional intent to keep a fully functioning Ex-lm Bank, and they 

also advanced important reforms to the agency. Chief among those reforms was a requirement 

for Ex-lm to appoint a chief ethics oflicer and a chief risk officer. Unfortunately, both of these 

appointments require approval by a quonnn ofEx-lm's Board and, therefore, have not been 

exe<:uted. 

Since the early 1990s, Ex-lm has generated $7 billion in revenue above its operating 

costs and returned these funds to Treasury, making this a government program that is not only 

smart for business, but also a victory for taxpayers. Preventing Ex-lm from approving large 

de.1ls and, in tum, collecting the associated fees for those deals could make 2018 the first year 

that Ex-lm stops being self-suflicienl. This could funher endanger the remaining functioning 

programs at the Bank, such as products aimed at supporting small exporters. 

We believe that Ms. Reed will uphold the critical mission ofEx-lm while providing 

much needed improved governance of the agency. In addition, it is long overdue for the full 
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71918327.eps

Senate to take up the nominations of Claudia Slacik, Judith Delzoppo Pryor, and Spencer Bachus 

to serve on Ex-1m's B()ard, which have already been favorably reponed by the Commiuee. The 

Senate should expeditiously restore a working qu()rum to this critical tool tor America's 

exporters. 

Ms. Kraninger has experience in both the legislative branch and the executive branch. As 

the current Associate Director for General Government at the Qfllce of Management and Budget, 

Ms. Kraninger oversees the budget and management for a number of executive departments and 

Federal agencies, including the Bureau and other financial regulators. This type of budgetary and 

managerial experience is essential to preparing the Bureau for long-term success. 

Since its creation, the Bureau has been beset by managerial shortfalls and has not been a 

traJlSparent agency. Ms.. Kraninger's experience would serve her well as the Director of the 

Bureau, especially as it aims to be a more transparent and accountable agency. 

The Chamber thanks you for considering these important nominations. 

Sincerely, 

J;Wi~ Neil L. Bradley 

cc: Members of the Senate Committee on Banking, Housing, and Urban Allairs 
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71918328.eps

Statement for the Record 

Oft he 

BAFT {Bankers Association for Finance and Trade) 

Before the 

Committee on Banking, Housing, and Urban Affairs 

Of the 

United States Senate 

On 

July 19,2018 

Chairman Crapo, Ranking Member Brown, and Members of the Committee: 

BAFT (Bankers Association for finance and Trade) is grateful for the opportunity to provide a 

statement for the record for the Committee hearing regarding the nomination of Ms. Kimberly A. 

Reed, of West Virginia, to be President of the Export·lmport Bank {EXIM). 

SAFT is an international financial services trade association whose membership includes over 270 

financial institutions and solution providers throughout the global community. Our members are 

active in trade finance .and many work with EXIM on a daily basis. Indeed, EXIM is considered an 

essential partner by the transaction banking community. EXIM has historically played a crucial role 

in global finance by providing guarantees and insurance that help cover gaps in trade financing 

otherwise available through the private sector. 

U.S. based lenders turn to EXIM to add credit capacity to existing limits, mitigate geopolitical and 

credit risks in an effort to better enable their corporate clients to compete with foreign companies 

for export trade opportunities. Smaller financial institutions are even more limited in their ability 

and capacity to take on foreign risk. EXIM helps alleviate these internal and external limitations on 

commercial loan portfolios by filling gaps in private sector credit capacity. Without access to all of 

the various EXIM programs, private·sector lenders cannot provide the required t!nancing or 

acceptable financing terms, resulting in lost sales for their clients. 

In the three years since the EXIM Board quorum lapsed, U.S. exporters have been at a significant 

disadvantage to competitors around the world that have government·backed export credit agencies 

(ECAs) supporting their sales. In fact, today there are 110 ECAs globally providing some type of 

export credit support, up from 85 in 2014. China remains the world's largest provider of official 

export credit, with an estimated $36.3 billion in medium to long term export credit, compared to 

EXIM's current $217.8 million. 

I llOConn«ticutA\'tnue N'W, Washington, DC 200J6 USr\ Telephone +l.l0l.6M.7HS fo\.'1: +1.20l..66USJS 

www.8 . .1.FT.org .tnro@:~ft.org 
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71918329.eps

The lack of a fully functioning EXIM Bank inhibits U.S. businesses from seizing job-creating 

opportunities to export. While the EXIMBank has been without a quorum for its Board, nearly $43 

billion in transactions are stalled in the pipeline awaiting a board quorum vote- projects that could 

support an estimated 250,000 U.S. jobs. This loss in sales does not only impact the large 

manufacturers directly, but also their supply chain of all size companies that provide inputs and 

services to them throughout the U.S. 

Small businesses typically rely on trade finance to a greater extent than larger corporales to get 

their product or service to market. They also face greater hurdles to accessing credit and typically 

do not have the capacity to directly mume credit risk on their foreign trading counter parties. Given 

that 98 percent of America's exporters are small businesses, the importance of having access to 

trade finance cannot be underestimated. While larger U.S. corporations have met some of their 

financing needs by other means, including shifting production to other jurisdictions, U.S. small 

businesses cannot and have not fared as well. 

Tariffs and non-tariff barriers result in increased cost and a reduction in international trade activity, 

which adversely affects not only the U.S., but also global growth. Escalating tariffs present new 

challenges for U.S. companies that seek to compete globally. Existing government programs offered 

by EXIM that help tO> ensure that U.S. businesses have the financial resources to succeed 

internationally should be reinstated and bolstered. BAFT also cautions that small businesses, which 

account for a significant percentage of employment growth through trade, bear a heavier burden 

when retaliatory protectionist measures are imposed, as they often lack the knowledge and 

resources to navigate through additional restrictions. 

As Congress makes progress to ensure greater economic growth and to improve the 

competitiveness of the U.S. business community, corresponding steps to facilitate access to trade 

finance would have a marked positive impact. The Senate has the opportunity to return EXIM Bank 

to fully functioning statvs by confirming Ms. Reed and the other qualified Soard nominees awaiting 

Senate confirmation. 

Ms. Reed has shown the leadership and vision to herald EXIM to a new era of U.S. competitiveness. 

Her experience at the Treasury Department, as counsel to three committees in the United States 

House of Representatives, and real-world experience in the financial services sector will serve her 

well as President of EXIM. Your action to reinstate a fully functioning EXIM will help to ensure that 

U.S. exporters c<n compete by having competitive access to much needed trade finance. 

Our members, together with the U.S. exporting community, call for Ms. Reed to be approved by the 

Committee, and swift action to advance the remaining slate of Board nominations to the floor for 

consideration as soon as possible. 

Thank you again for the privilege of providing the Committee with our vie\'15. 

I llOConn«ticutA\'tnue N'W, Washington, DC 200J6 USr\ Telephone +l.l0l.6M.7HS fo\.'1: +1.20l..66USJS 

www.8 . .1.FT.org nro@:~f .org 
176 


71918330.eps

Robinson, Sierra (Banking) 

From: 

Sent: 

linda Dempsey, NAM <ldempsey@nam.org> 

Wedn~day, July 18, 2018 1:00 PM 

To: Robinson, Sierra (Banking) 

Subject: NAM letter for the Senate Banking Committee regarding the Elc·lm Bank 

Colleagues: 

In advance of Ex-lm Bank nominee Kimbe~y A. Reed's hearing before the U.S. Senate Banking, Housing, and 

Urban Affairs Committee tomorrow, please see this letter from the National Association of Manufacturers 

(NAM) regarding the Ex-lm Bank. In addition to the hyperlink, the letter is embedded below. 

Thank you for all of your work on this important issue. We remain available for questions or consultations at 

your convenience. 

Best wishes, 

linda Menghetti Dempsey 

Voce President, International Economic Affairs 

Email: ldempsey@nam.org I Twitter. @LOempseyNAM 

Direct: (202) 637-3144 

Mobile: (202) 465-$081 

Nt NA NA \<SCv \T '11-< 

Manufacturers 

Linda Dempsey 

V'100 President 

tntema!io<>at Eccncmic Affairs 

July 18, 2018 

The Honorable Mike Crapo 

Chairman 

Senate Committee on Banking, Housing and 

Urban Affairs 

239 Dirksen Senate Office Building 

Washington, DC 20510 

The Honorable Sherrod Brown 

Ranking Member 

Senate Committee on Banking, Housing and 

Urban Affairs 

713 Hart Senate Office Building 

Washington, DC 20510 

Dear Chairman Crapo and Ranking Member Brown: 

The National Association of Manufacturers (NAM), the largest manufacturing association in the United 

States and the voice of the more than 12 million manufacturing workers across America, welcomes the 
177 


71918331.eps

committee's consideration of the nomination of Kimberly Reed as president and chair of the Export-Import (Ex1m) Bank. 

The NAM, which represents 14,000 manufacturers small and large in every industrial sector and in all 

50 states, believes Ms. Reed will bring to the Ex-lm Bank strong experience in financial management and 

banking issues. That experience, along with her strong recognition of the importance of the Ex-lm Bank to 

grow manufacturing and jobs in the United States, will provide much-needed leadership to ensure the Ex-lm 

Bank operates effectively to advance America's export success. while ensuring proper fiscal operations at the 

agency. Ms. Reed is a superb choice to lead the Ex-lm Bank, as this committee has recognized previously, 

and the NAM strongly supports quick action by the committee to advance her nomination. 

We also urge prompt action by the full Senate to confirm not only Ms. Reed but also the other pending 

nominees to the Ex-lm Bank Board of Directors-Spencer Bachus, Claudia Slacik and Judith Pryor-all of 

whom this committee has already reported out favorably. 

Across America, manufacturers need a fully functional export credit agency to compete and win 

globally. At last count, there are 96 other government-backed export credit agencies working aggressively to 

promote domestic industries irn other countries around the wortd, from Australia, to the United Kingdom, to 

China. Indeed, China is the world's largest provider of official export credit, providing more trade-related 

investment support than the rest of the world combined. Last year, China provided $34 billion in medium- and 

long-term export Cfedit and S50 billion in investment support. At the same time, the lack of a quorum has 

hobbled our own Ex-lm Bank; therefore, the agency is unable to consider loans in excess of S10 million, let 

alone make necessary reforms to better serve the small business community or improve risk management 

Failure to take action to ensure a fully functioning Ex-lm Bank is tantamount to unilateral disarmament. 

It means that, every day, manufacturers in the United States continue to miss out on deals that support 

American jobs because there is not available domestic financing. Currently, there are nearty $43 billion in deals 

that are stuck in the pipeline due to the lack of a quorum. This blockage harms manufacturers large and small. 

Indeed, more than 90 percent of the Ex-lm Bank's fiscal2016 transactions supported small businesses. 

Vacancies on the Ex-lm Board of Directors jecpardize the future of these small businesses and the 1.4 million 

jobs that the agency has supported over the past eight years. 

Manufacturers appreciate the committee's hearing to consider Ms. Reed's nomination and call on the 

committee to move forward expeditiously the nomination of Ms. Reed and to work with Senate leadership to 

ensure quick action to confirm her and the other pending Ex-lm Bank Board of Director nominees. 

Respectfully, 

linda M. Dempsey 

CC: Members of the Senate Banking Committee 
178 

LETTER SUBMITTED BY FRANCIS CREIGHTON, PRESIDENT AND CEO, 

CONSUMER DATA INDUSTRY ASSOCIATION 


71918332.eps

l§CDIA 

July 19, 2018 

The Honorable Michael D. Crapo, Chairman 

The Honorable Sherrod Brown, Ranking Member 

Committee on Banking. Housing & Urban Affairs 

United States Senate 

Washington, DC 20510 

Dear Chairman Crapo and Ranking Member Brown: 

Comumtt Datalnd~~t«v Aswri.lt*\ 

1090VermontAve., 1M, Suite WI) 

WMIIInlfon.O.C.200QS.4!0S 

P2023110910 

COIIIOirlll"f.ORG 

The Banking Committee hearing on July 12, 2018 was important and useful. The purpose of 

this letter is to provide clarity and perspective for some of the issues covered at the hearing. 

We appreciate your continuing focus on the important issues our industry faces and look 

forward to working with you to improve the entire consumer reporting system. 

At the outset we want to emphasize three critical points. First, as the Committee knows, 

the nationwide Consumer Reporting Agencies {CAAs) are comprehensively and continuously 

examined and supervised by the Bureau of Consumer Financial Protection {BCFP). Peggy 

Twohig, Assistant Director of Supervision Policy at the BCFP, testified that the CRAs have 

worked effectively with her office to improve accuracy including improving furnisher data 

and reinvestigation outcomes. Second, as the Committee also knows, the consumer 

reporting space is governed primarily by the Fair Credit Reporting Act {FCRA), an important 

consumer protection law that gives consumers choice and control over their credit files. A 

few of the many consumer protections embedded in the FCRA include access to an annual 

free credit report from each CRA, limitations on who can access a credit file and for what 

purposes, identity theft prevention mechanisms, credit freezes, a dispute process to 

address inaccurate information, accuracy standards and liability for noncompliance. Third, 

with the Committee's leadership, Congress enacted the Economic Growth, Regulatory 

Relief, and Consumer Protection Act1

, which included a national standard for free security 

freezes, provides for free credit monitoring for active duty servicemembers and creates new 

protections for veterans' medical debt. 

The FCRA and its enforcement mechanisms, examination and supervision processes and 

now the national standard for a free security freeze have established a fair and robust credit 

reporting system 

At the hearing. Senators and the agency witnesses discussed a variety of issues related to 

consumer protections, data accuracy and the responsibilities of tredit reporting 

agencies. COlA appreciates the Committee's interest in these important issues and we 

1 Pl115·174. 
179 


71918333.eps

welcome the opportunity to share additional information regarding some of the topics 

discussed during the hearing. 

What information is collected by CRAs and how is it used? 

It is important to understand the type of information generally held by CRAs and used in a 

credit report. The nationwide CRAs basically hold the following kinds of information: 

• Identifying information to ensure that individuals are correctly matched to their 

individual data file; 

• Public record information, such as whether someone has gone through bankruptcy; 

• Current and past credit accounts, known as "tradelines", as reported by lenders and 

creditors, including: 

o Type of account, 

o Date account opened, 

o Balances, 

o Creclit limits or loan amount, and 

o Account payment history; 

• Credit inquiry information; and 

• Collection information. 

As noted at the hearing, the nationwide CRAs are examined by the BCFP on their credit 

bureau activities and adhere to the law, which circumscribes much of what the credit 

bureaus can do with the data furnished. CRAs are fundamentally different from other data 

brokers because of these regulatory and legal requirements on how data can be used and 

who has access to it. 

The significant issue of "credit invisible" and "thin file" consumers was raised at the hearing. 

CRAs are working to bring other kinds of data into the regulated FCRA system so more and 

better information about individual people can be gathered to increase access to traditional 

banking products. For example, if a consumer does not have a traditional loan product but 

pays a cell phone bill every month, that behavior may indicate a positive credit risk. 

Consumer Transparency and Control 

The FCRA requires CRAs to allow consumers to access their credit report annually, which 

can be done at AnnuaiCreditReport.com or through multiple other sources. This 

requirement provides consumers with transparency and the opportunity to review 

information in their credit files. 

TheGramm-leach·Biiley Act (GLBA) is another important consumer protection law that 

governs consumer reporting. Title V of GLBA defines and restricts how financial institutions, 

may share "nonpublic personal information• with nonaffiliated third parties such as credit 

reporting agencies. These provisions govern how consumer reporting agencies obtain data 
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from financial institutions and how CRAs can further use and disclose such data. GLBA, as 

implemented by the BCFPthrough Regulation P2

, requires a financial institution to provide 

notioe of its privacy policies and practices to its customers, and dictates the timing and 

content of such notice. These notices include information about a financial institution's 

sharing of data with credit reporting agencies. 

Credit reports can only be used for "permissible purposes," as outlined in FCRA §604. These 

include "firm offers of credit," which allow potential lenders to market financial products to 

individuals based on those individuals' specific needs. For example, a mortgage borrower 

may benefit from a lower interest rate and so a lender is able to send a targeted 

communication to that potential new customer with a customized product. These firm 

offers of credit are critical methods lenders use to diversify and strengthen their portfolios. 

If consumers do not want to receive these offers they can easily opt out by going to 

www.optoutpresecreen.com or by going to individual companies' websites. Further, every 

firm offer of credit must include a notioe informing consumes how they can opt-out of 

future offers. 

Given security incidents in our industry and across the economy, including multiple massive 

breaches in the federal government, consumers are rightfully concerned about what steps 

they should take to protect themselves. A consumer concerned about identity theft should 

first consider placirng an "initial fraud alert" on their file at no cost, which is the first line of 

defense for consumers1

. An "extended fraud alert" helps consumers who are victims of 

identity theft but expect to be credit-active. A consumer can place an extended alert on 

their file for seven years by presenting a copy of a law enforcement report or a Federal 

Trade Commission (FTC) affidavir. 

While alerts are on a consumer's file, lenders are encouraged to contact the consumer 

through a method the consumer designates to confirm the consumer's identity before 

extending a new line of uedit, increasing a line of credit or issuing a new or replacement 

card. The consumer can remove alerts by providing proof of identity. Fraud alerts 

requested at one bureau are shared with the other two bureaus. 

For consumers who have become victims of identity theft, a credit freeze may be 

appropriate. Thanks to the Economic Growth, Regulatory Relief, and Consumer Protection 

Act, starting in September, credit freezes will be free across the country. A freeze, 

effectively, prevents acoess to a credit report by certain third parties unless the consumer 

contacts the credit bureau in advance to say otherwise. Therefore, a consumer can only 

' 12 C.F.R Part 1016. 

' An initial fraud alert is valid for90days. Under PlllS-174 the initial fraud alert was extended to one vear. 

• One other alert is an "active duty alert,• wllkh lasts for a year and it is a preventative option for a consumer 

who serves in the military. 
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71918335.eps

obtain credit by taking the extra step of contacting one or more credit bureaus ahead of 

time. A freeze remains on the file until the consumer lifts or removes it. When a freeze is in 

place, the consumer's file cannot be accessed for purposes involving extension of new or 

existing credits. 

Identity protection and credit monitoring seiVices are widely available in the market, both 

fee-based and free services. Your Committee recognized the value of these services by 

requiring nationwide CRAs to provide credit monitoring seiVices for free to active duty 

members of the military. Thousands of businesses across the country pay for this seNice 

and offer it to their employees as an employee benefit. Millions of Americans utilize these 

seNices individually. 

lenders have an important role in helping consumers take control of their credit reports 

too. For example, if a consumer applies for credit but is denied or receives it on less-than 

ideal terms, lenders deliver an adverse action notice or a risk-based pricing notice to the 

consumer informin,g the consumer of what occurred and urging the consumer to obtain a 

free credit report and confirm the accuracy of the information contained therein. Multiple 

banks have begun disclosing credit scores as part of monthly bills6

• Additional transparency 

is achieved through financial institutions' monthly statements, where lenders are required 

to notify consumers if they report derogatory information, such as late payments, to a CRA. 

Consumers today have many avenues to control their credit records and we urge them to 

take advantage of these opportunities. 

Consumer Dispute Process 

The FCRA guarante<!S consumers the right to dispute information that has been previously 

reported to CRAs. The consumer may initiate a dispute directly with a consumer reporting 

agency, a reseller Clf consumer reports or directly with the entity that furnished the item to 

the credit bureau. Regardless of the source at which the dispute originates, the data 

furnisher must respond and investigate, reviewing all relevant information provided by the 

consumer and the CRA After the investigation the furnisher reports the investigation 

results to the CRA and other consumer reporting agencies to which the data provider 

furnished the information. 

FCRA §611(a)(S)(D) requires the industry to maintain an automated dispute resolution 

system. This system, called e-OSCAR•, is available for use by all data furnishers. 

' There are some exceptions, wbich vary by state. PlllS-174 de ai~ exceptions that will apply to the national 

credit freeze standard. 1 CRAs do not produce-ctedit score~ Scores are produced by separate companies. 
182 


71918336.eps

When a consumer disputes an item on their credit report to a CRA, the agency transmits the 

disputed information (including any supporting documents) to the data furnisher through e· 

OSCAR' . The data furnisher retrieves the information, researches the dispute and transmits 

a response back to the originating CRA via e·OSCAR•. If the information is verified as 

correctly reported, the response goes only to the originating consumer reporting agency. If 

the information is modified or deleted, e·OSCARe automatically sends a response to the 

originating consumer reporting agency and sends copies to any other consumer reporting 

agencies with which the data furnisher's registration is active in e·OSCAR'. The CRAs 

receive responses, update the credit files accordingly and respond back to the consumers. 

Over the twelve-month period ending June 30, 2018, 39.4% of individual disputes handled 

through the e·OSCAR• system were addressed within seven days. An additional23% were 

addressed within 14 days of receipt. The remainder of these disputes were resolved within 

30 days. Furnishers of data (lenders and others) take their responsibilities under the FCRA 

seriously and move as quickly as possible; but when a case needs more investigation they 

take the time to get it right. 

CRAs work hard to make the system as easy as possible for consumers, and as efficient as 

possible forfurnishers, so that they can ensure maximum possible accuracy of the files. 

Accuracy of Consumer Reports 

In 2013, the FTC published a congressionally mandated study on credit report accuracy. The 

FTC looked at all of the primary groups that participate in the credit reporting and scoring 

process: consumers; data furnishers (creditors, lenders, debt collection agencies and the 

court system); scor<e developers; and the national credit reporting agencies. The FTC report 

is based on work with 1,001 participants and 2,968 credit reports. The FTC found that: 

• Only 2.2 %of credit reports had an error that would increase the cost of credit or a 

loan in the credit market1. 

• 88% of all errors could be attributed to data being transmitted to credit bureaus by 

data furnishers8• 

The assertion that one in five credit reports has a material error significant enough to 

impact a consumer's score is not supported by the FTC's study. The FTC findings are 

consistent with academic research completed in 2011. In 2011, the Policy and Economic 

Research Council (PERC) published a review of 2,000 consumers and more than 81,000 

credit accounts for those consumers on their credit reports9

• The study was comprehensive 

' Repcrt to Congrtss Under Section 319 of the Foir ond Accurate Credn Tronscctions Ad of 2003, Dec. 2012, 

page A-4, avail.lble at www.ftc.gov/os/20!3/02/!30211factarepcrt.pdf. 

' rd., Appendix o. M~ha f A. Turner et ol., U.S. Consumer Credit Repcrts: Meow ring Accuracy ond Dispute lmpcct5, Policy & 

Economic Research Council (PERC) (Mav 2011), avail<ble at http.f/www.perc.net/wp· 
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and statistically sound. It is the first (and only) third·party peer-reviewed study dealing with 

the issue of credit report errors and their material effect on the creditworthiness of 

consumers. Among other findings, PERC found that: 

• Less than one percent (0.93%) of all credit reports examined by consumers 

prompted a dispute that resulted in a credit score correction and an increase of a 

credit score of 25 points or greater; 

• After the dispute process ran ~s course, one-half of one percent (0.50%) of all credit 

reports examined by consumers had credit scores that moved to a higher "credit risk 

tier" as a result of a consumer dispute; and 

• 95% of all consumers who participated in the dispute process were satisfied with the 

outcome. 

The Federal Reserve has reviewed the reliability of consumer reports and made several 

observations. Most importantly, the Federal Reserve, which looked at over 300,000 credit 

reports, noted that: "(o)verall, research and creditor experience has consistently indicated 

that credit reporti11g company information ... generally provides an effective measure of the 

relative credit risk posed by prospective borrowers10." 

Our industry continues to make significant progress in addressing the sources and root 

causes of the errors that do occur. Working with state Attorneys General, for example, over 

the last year the industry has implemented: 

• An escalation program for hard to fix problems like identity theft and mixed files to 

be more responsive to consumers; 

• Deletion of public records that lack proper identifying information to prevent filematching errors; 

• Additional new matching standards to prevent mixed files; and 

• A delay of medical debt reporting to allow for insurance and other disputes to be 

worked out before any medical debt comes onto the file. 

We are incentivized by our customers to provide correct information; failing to do so would 

be bad business, would ill-serve our customers and the public and open our companies up 

to significant legal liability. Our companies, furnishers and customers are examined by the 

BCFP for adherence to federal standards. It is simply untrue to suggest that companies 

engaged in credit reporting have no incentive to be accurate. 

conrenrjuploods/2013/09/DQreport.pdf. In responre to criticism of PERC's work by seve<al consumer 

activists, PERC pvblished a follow-up paper restating the validity of its woJtand reiterating ~s support by its 

independent peer·revlew board. Michael A. Tumer, Generol Response to Criticisms of recent PERC report: 

U.S. Consumer Credit R.eporting: Measuring Accurocyond Dispute 1m poets, Polky & Economk Research 

Council (PERC) (August 2011), available at http://www.perc.net/wp-content/uploads/2013/09/GR.pdf. 10 An Overview of Conwmer Do to ond Cm><umer Reporting, Federal Reserve Bulletin, Feb. 2003, 50-Sl; See 

also: Credit Reporting Accurocy end Access to Credit, Fedetal Reserve Bulletin, Summer 2004, 320, available at 

https:f{www federalr~rve.gov/pubs/bull tin{2003 0203 ead.pdf. 
184 


71918338.eps

Congress recently required the GAO to conduct an analysis of many aspects of the 

consumer reporting system, including accuracy, causes of errors and the dispute process. 

This study could provide important new information to inform discussions on these topics 

and help the Committee assess the industry based on new and updated information. 

Data Security 

Data security practices for CRAs are structured around preventing and mitigating risks to 

the security of consumer data. These practices are designed to comply with federal and 

state legal obligations under the jurisdiction of the FTC, BCFP and state regulators. On the 

federal level, the Gt BA ensures the security and confidentiality of any information CRAs 

maintain. 

The FTC enforces the GLBA for consumer reporting agencies through its Safeguards Rule, 

which mirrors requirements imposed on traditional banks by Interagency Guidance issued 

by the Federal Reserve and other regulators. The Safeguards Rule imposes specific 

standards designed to: 

• ensure the security and confidentiality of customer records and information; 

• protect against any anticipated threats or hazards to the security or integrity of such 

records; and 

• protect against unauthorized access to or use of such records or information which 

could result in substantial harm or inconvenience to any consumer11• 

The Safeguards Rule requires financial institutions to "develop, implement, and maintain a 

comprehensive information security program" that includes appropriate administrative, 

technical and physical safeguards to achieve these objectives. This program is required to 

be tailored to the institution's size and complexity, the nature and scope of its activities and 

the sens~ivity of any customer information at issue12• 

Financial institutions, including credit reporting agencies, must also designate an employee 

to coordinate their comprehensive information security program, as well as identify 

reasonably foreseeable risks to the security of the information. Financial institutions must 

assess the sufficiency of safeguards and design, implement and regularly test safeguards to 

protect against such risksll. Finally, the Safeguards Rule obligates financial institutions to 

oversee their service providers' cybersecurity practices, both by taking reasonable steps to 

ensure their service providers employ strong security practices, and by entering into 

contracts with such providers that require them to implement appropriate safeguards14• 

11 15 U.S.C. § 6801(b); 16 C.F.R. § 314.4lb). 11 !6C.F.R. § 314.3la). 

u 16c.F.R. § 314.4. 

"16c.F.R. § 314.4ld). 
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These common-sense provisions are general parameters designed to allow evolving 

standards to keep pace with the evolving threat landscape. At their inception lawmakers 

and regulators anticipated that private institutions and the government overseers closest to 

the battle lines and with the greatest expertise in these matters would fine-tune industry 

best practices over time. 

CRAs are also subject to the FTC's jurisdiction over cybersecurity matters under Section 5 of 

the FTC Act 11• The FTC is empowered to take action against any business that engages in 

"unfair or deceptive acts or practices" ("UDAP"), which the agency has interpreted to 

include inadequate data security practices16• 

The FTC requires that a company employ safeguards for information that are •reasonable in 

light of the sensitivity and volume of consumer information it holds, the size and complexity 

of its data operations, and the cost of available tools to improve security and reduce 

vulnerabilities"." While specific cybersecurity requirements under Section S are not 

codified, the FTC has issued detailed guidance that explains what it considers to be 

reasonable cybersecurity safeguards. These include practices such as encryption, use of 

firewalls, use of breach detection systems, maintaining physical security of objects that 

contain sensitive information and training employees to protect such information". 

In addition to issuing detailed guidance, the FTC zealously enforces these standards, having 

brought over 60 cases since 2002 against businesses for putting consumer data at 

"unreasonable risk1'." 

The FCRA requires that credit reporting companies only provide credit reports to people 

with a "permissible purpose" to receive such reports, such as credit or insurance 

underwriting. More importantly, the law requires that every credit reporting company 

maintain reasonable procedures designed to ensure that credit reports are provided only to 

permissible people for legitimate purposes. These procedures require that prospective 

users of credit reports identify themselves, certify the purposes for which the information is 

sought and certify that the information witt be used for no other purpose. The FTC has 

brought multiple actions over the years seeking to enforce these provisions, most notably 

IS 15 U.S.C. § 45. 14 See Congres~onal Research Service, 'The Federal Trade Commission's Regulation of Data Security Under Its 

Unfair or Deceptive Acts or Practices {UDAP) Authority" !September 11, 2014), 

https://fa~orgjsgp/crs/miS</R4372l.pdf. 

»Federal Trade Commission, "Data Security", https://WIIW.ftc.gov/datasecurity. 

" See, e.g., Federal Trade Commission, "Protecting Personal Information: A Guide for Business", 

https://WIIW.ftc.gov/r;stern/files/documents/pla nguage/pdf.Oll6_proteting·persona ·informatio .pdf. 

" See Federal Trade Commission, "Privacy and Data Security Update I1016)"1January 2017), 

https://WIIW.ftc.gov/reports/privacy-(!ata·seoority·update·2016. 
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against ChoicePoint10, which was alleged to have unwittingly sold credit reports to a ring of 

identity thieves. In the ChoicePoint case, the FTC collected millions of dollars in consumer 

redress and civil penalties, including a $10 million civil penalty in connection with the 

unauthorized disclosure of "nearly 10,000 credit reports," which were allegedly sold by 

Choice Point to persons without a permissible purpose. 

The nationwide credit bureaus have been examined by the BCfP with respect to the 

strength and resiliency of their credentialing procedures. As a part of their credentialing 

procedures, credit reporting companies maintain detailed written procedures which take 

into account the risks presented by prospective users and their proposed uses of 

information. These procedures routinely include: 

• site visits to ensure the premises are consistent with the stated business of the 

prospective customer; 

• review of public information sources and public filings to confirm licensure and good 

standing; 

• review of company websites and other public-facing materials; 

• checking financial references, including credit reports of owners for certain types of 

companies, such as those that are not publicly traded; 

• specific and detailed contractual representations and warranties, as well as specific 

certifications, that credit report information will be used only for specified purposes; 

• detailed customer on-boarding and training procedures; and 

• ongoing monitoring of customers-including transaction testing- to ensure that 

customers are in fact using c.redit reports for legitimate and permissible purposes. 

In addition to these credentialing requirements, the FCRA prohibits cred~ reporting 

companies - and anyone else handling credit report information - from disposing of that 

information in a manner that is not secure. More specifically, the FTC issued a rule 

providing that a person who maintains or otherwise possesses credit report information, or 

information derived from credit reports, must properly dispose of such information by 

taking reasonable measures to protect against the unauthorized access to or use ofthe 

information in connection with its disposal11• 

Recently, the BCFP has asserted its Unfair, Deceptive or Abusive Acts or Practices (UOMP) 

authority to examine the nationwide CRAs for their data security practices. 

In addition to these federal regulatory frameworks, credit reporting companies also have 

numerous data seour~ obligations under state law. first, credit reporting companies may 

10 See Federal Trade Commission, "ChoicePoint Settles Data SeaJrity Breach Charges; to Pay $10 Million in C"rvil 

Penalties, $S Million for Consumer Redress" (/anuary 26, 2006), https~/www.ftc.gov/nf!WS~ents/press· 

releases/1006/01/choicepoint-settles-data-security-breach<harges-pay-10-million. 

" See FCRA § 618. 
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be subject to data security enforcement of state 'mini-FTC Acts" that prohibit unfair or 

deceptive acts or practices22• Further, at least thirteen states require businesses that own, 

license or maintain personal information to implement and maintain reasonable security 

procedures and practices and to protect personal information from unauthorized access, 

destruction, use, modification or disclosure21. The majority of states require businesses to 

dispose of sensitive personal information securely24• 

Every state, DC and several U.S. territories have enacted laws requiring notification to 

affected individuals following a breach of personal information25• These laws typically, but 

do not always, exempt institutions that are supervised by the federal bank regulators, who 

have their own bre~ch notice regime. In contrast, credit reporting companies-which are 

not supervised by the bank regulators-must comply with the patchwork of more than four 

dozen breach notification laws if a breach does occur. 

Even beyond these direct governmental requirements, the three nationwide credit bureaus 

- Equifax, Experian and Transunion- are also subject to substantial additional legal 

requirements that result from doing business with other major financial institutions. The 

information security programs at many credit bureau financial institution customers are 

supervised by federal prudential regulators, i.e., the Federal Reserve, the Office of the 

Comptroller of the Currency, the Federal Deposit Insurance Corporation or the National 

Credit Union Administration. Under comprehensive and detailed information security 

standards published by the Federal Financial Institutions Council (FFIEC), these financial 

institutions must oversee the information security programs of their third-party service 

providers26• Pursuant to these FFIEC requirements, financial institutions and their auditors 

subject the nationwide credit bureaus to dozens of information security audits each year, 

many of which include onsite inspections or examinations. 

The Payment Card Industry Data Security Standard {"PCI OSS") is a mandatory set of 

cybersecurity requirements for all organizations that store, process and transmit sens~ive 

payment card information of the major credit card associations, including credit bureaus. 

u SeE, e.g., X3vier Becerra, (alifornia AttorneyGeoeral, "Attorney Geoeral8ecerra: Target Settles Record 

$1S.S Million Credit card Data Breacll <:ase" IMay 23, 2017), https://oag.~.gov/news/press· 

releases/attomey-general-be<erra-target-settles-record-185-million-credit<ard-data. 13 SeE National Ccnfert!flce of State legislatures, "Data Seoority laws- Private Sector" !January 16, 20171, 

http //Www.ncsl.org/researdl/telecommuni~tions·and information tecllnology/data·seoority laws.a!j)x. 

"SeE National Ccnfert!flce of State legislatures, "Data Di!j)Osal laws" !December 1, 2016), 

http:/ Jwww ncsl.org/researdl/te ecommuni~tions-and-information·tecllnology/data-disposal·laws aspx. At 

the fe<lerallevel, the FTC's Di!j)Osal Rule regulates the proper disposal of consumer report information. SeE 

16 C.F.R. pt. 682. 

" SeE National Conference of State legislatures, "Seoority Breach Notifi~tion laws" (A,o<il12, 2017). 

,. SeE FFIEC,IT Examination Handbook lnfobase, "Information Seoority: OYer~ght of Third-Party Service 

Providers: https:/(othandbook.ffiec.g<W(ot-bootdets{.nformation·security{li-information-SI!Curity-j)rogrammanagement/iic·risk·mitigatiorl(oic2D-oversight-of·third·party·lel'lice·providers.aspx. 

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The standard requires credit reporting companies to take a number of specific steps to 

ensure the security of certain information. For example, the PCI OSS requires members to 

install and maintain firewalls, encrypt the transmission of cardholder data, protect against 

malware and implement and update anti-virus programs, restrict both digital and physical 

access to cardholder data, regularly test security systems and processes and maintain a 

detailed information security policy for all personnel. The standard imposes further 

detailed and specific technical requirements for the protection of cardholder data, such as a 

restriction on service providers' storage of personal identification or card verification 

numbers after card authorization. In addition, the standard requires a service provider to 

ensure that any third parties with whom it shares data also comply with the PCI OSS17• 

Service providers that store, process or transmit cardholder data must be registered with 

the card networks and demonstrate PCI OSS compliance. PCI OSS compliance validation is 

required every 12 months for all service providers. 

Conclusion 

American consumers have a transparent and fair credit system. Individuals have the ability 

to access credit anywhere in the country from a wide variety of lenders based solely on 

their own personal history of handling cred~. This means that when a family tries to buy a 

house for the first time, they are going to be able to access the right mortgage for their own 

personal needs. A young person who has a new job in a new city and has to buy a car to get 

to work can go to an auto dealer and drive off the lot even if she or he has no physical 

history in that community. lower income families can access cred~ through mainstream 

financial institutions rather than depending upon shadowy lending services. 

Today's credit repMing system has made it possible for many middle-class consumers to 

get credit at rates that previously would have been reserved for the wealthy. If a consumer 

has been a responsible user of credit in the past, lenders and others are more likely to offer 

credit at the most favorable terms. Credit reporting companies continue to innovate to find 

ways to score "unbanked" or "credit invisible" consumers, who have not had a chance to 

participate in the mainstream financial system because they have "thin" or no credit files. 

By expanding the kinds of information that we collect, we are able to give lenders and 

others information that allows more consumers to access traditional bank products. 

Our credit reporting system today is the envy of the world, and other countries actively 

work to emulate what we do here. It is one of the main reasons American consumers have 

such a diverse range of lenders and products from which to choose, in stark contrast to 

many other financial systems, even those in developed nations, as inst~utions of different 

sizes are able to assess consumers based on a common set of information. In particular, 

" Payment card Industry Security Standards Countil, •Requirements and Security Assessment Procedures, 

Version 3.2" 1Apri 20l~l. 

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smaller community-based lenders disproportionately benefit from the consumer reporting 

system; without information supplied by CAAs, community-based lenders would not be 

readily able to assess risk and provide loans on competitive terms in the communities in 

which they operate. 

Again, thank you for holding this hearing. We appreciate your focus on these issues and 

look forward to continuing to work with you, the Committee and the entire Senate on 

strengthening the consumer reporting system. 

Francis Creighton 

President & CEO 

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