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While it remains to be seen whether or not the Senate will do anything substantial to reverse his action, President Obama appointed Richard Cordray on January 4th to head up the new Consumer Financial Protection Bureau, commonly referred to as the CFPB. The controversial appointment, flying in the face of Congress's "pro-forma" sessions and several months of battles between Democrats and Republicans, frees the CFPB to begin exercising its full power under the Dodd-Frank Bill to regulate all consumer related financial transactions including non-banks and mortgage lenders.

This, of course, includes supervision of reverse mortgage lending as well. The first step in this arena will be for the CFPB to conduct a study of the reverse mortgage industry during the coming year. In a statement of his intentions Cordray said, "I am pleased to say that we will now be able to exercise the full authorities granted to us under the law and begin to supervise these non-banks. . . Over the coming weeks, we'll be announcing more information about this program and how it will help to improve the consumer financial markets . . . Now, with a Director, the CFPB can exercise its full authorities - with respect to both banks and nonbanks - to help those markets operate fairly, transparently, and competitively."

While these intentions and the over-all design of the CFPB sound laudable enough, those opposing the creation of this new Bureau fear that it grants too much power to the Director to mandate new financial regulations without sufficient accountability. Republicans have long argued for a bi-partisan five member Commission to head the new Bureau. It is a distinct possibility that infuriated Senate Republicans may initiate a court challenge claiming that the appointment is in violation of the Constitution.

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