Asserting leadership (and picking battles), new consumer bureau director unplugs name change plan of predecessor

Possibly in a move to pick her battles, the new director of the federal consumer financial protection agency Wednesday told her staff that she was pulling the plug on a name change instituted by her immediate predecessor.

Kathy Kraninger, newly installed director of the Consumer Financial Protection Bureau (CFPB, formerly known as the Bureau of Consumer Financial Protection), told agency staff in a memo Wednesday morning that she has “officially halted all ongoing efforts to make changes to existing products and materials related to the name correction initiative.”

“For statutorily required reports, legal filings, and other items specific to the Office of the Director, we will use the Bureau seal and the statutory name we were given in Dodd-Frank,” Kraninger said. “The name ‘Consumer Financial Protection Bureau’ and the existing CFPB logo will continue to be used for all other materials.”

Last April, Acting Director John (“Mick”) Mulvaney said he was – unilaterally – officially changing the name of the agency to “Bureau of Consumer Financial Protection.” Since its inception eight years prior to that, the agency had been known as CFPB.

In making the change to the agency’s acronym, Mulvaney indicated he was only following the law. “That is what the law says,” Mulvaney noted; he also said the first thing he did when he was named acting director of the agency in November was to “read the law” creating the bureau.

However, an internal CFPB analysis that surfaced early this month asserted that costs for changing the name of the agency would force banks, credit unions and other lenders and financial firms to spend about $300 million in total to update their databases, regulatory filings and disclosure forms with the new “BCFP” name to be in compliance with the rules enforced by the agency.

Additionally, the analysis claimed that the name change would cost the agency itself between $9 million and $19 million to cover updates to internal materials and its website.

Kraninger was confirmed to her position (and sworn in) just last week and has faced two challenges by congressional Democrats. Monday, Sen. Elizabeth Warren sent a letter to the inspector general of the Federal Reserve and the CFPB calling for an investigation into the legality and cost of an agency name change.

Late last week, likely incoming House Financial Services Chairman Maxine Waters (D-Calif.) and 22 other Democratic members of the committee sent a letter to Kraninger urging her to recommit the CFPB to “fulfilling its supervisory role over consumer protection laws, including the Military Lending Act” (MLA). The lawmakers wrote that, during Mulvaney’s tenure, the bureau discontinued the supervision of regulated entities for compliance with the MLA, “neglecting its responsibility under the law to protect servicemembers and their families.”

In her note to bureau staff, Kraninger listed several reasons for reverting back to the CFPB acronym in most public uses (even though “BCFP” will be used in legal filings).

“We have a legal name but will be using our colloquial name and the branded acronym ‘CFPB,'” she wrote.

“Many of us have legal names but use nicknames without much confusion. My birth certificate says Kathleen, but I also answer to Kathy. I think we can do the same here. I believe this decision is most efficient and effective for our continued work together.” (She did not note the irony that Mulvaney’s legal name is “John Michael” but he typically uses the sobriquet “Mick.”)

Kraninger said she assigned bureau acting Chief Operating Officer Kate Fulton “to develop and disseminate guidance on the use of the name, seal and logo of the Bureau.”