A formal withdrawal of Judy Shelton’s nomination to be a member of the Federal Reserve Board was issued Thursday by the White House, officially ending the bid of the controversial nominee to become a central bank governor.
President Joe Biden also officially withdrew the nomination of Brian P. Brooks for a five-year term as comptroller of the currency. That move was somewhat moot, since Brooks resigned as acting comptroller Jan. 14.
Both the nominations of Shelton and Brooks had been made by former President Donald Trump on Jan. 3, just 17 days before he left office.
President Donald Trump formally nominated Shelton, an economist and consultant, to the board in January 2020. In July of last year, the Senate Banking Committee recommended her to the full Senate for confirmation on a 13-12, strictly party-line vote.
Shelton had drawn controversy and some criticism for her past views about reinstituting the gold standard, questioning the effectiveness of federal deposit insurance, and the Fed’s independence from political influence.
The Senate tried at least twice – in September and November – to move forward on approving Shelton’s nomination. However, both times it became clear to her Senate supporters that she did not have the votes for confirmation, especially since all Democrats and a handful of Republicans vowed to vote against her.
Brooks joined the Office of the Comptroller of the Currency (OCC) as chief operating officer in April. He was named acting comptroller after Joseph Otting resigned in late May immediately following his approval of a final, revised Community Reinvestment Act (CRA) regulation that lacked sign-off by either of the other two federal banking agencies (Federal Deposit Insurance Corp. and Federal Reserve).
Brooks held on as acting comptroller after the election, and Trump named him his choice for comptroller (and Shelton for the Fed Board) even though Trump had already lost the election and was headed out the door. Brooks then resigned on Jan. 14 – right after approving the so-called “fair access” rule, codifying that banks should conduct risk assessments of individual customers before denying them credit. Originally slated to take effect April 1, the rule is generally aimed at blocking national banks from refusing to extend credit to oil and other energy companies out of a concern for the impact of their operations on the environment or climate change.
However, the OCC under Brooks’ successor as acting comptroller – Blake Paulson – announced Jan. 28 it was pausing the “fair access” rule, to give the next comptroller time to review it and the public comments received by the agency on the proposal.
Biden has not yet tapped a nominee to a five-year term as comptroller.