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Rohit Chopra

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Rohit Chopra
3rd Director of the Consumer Financial Protection Bureau
Incumbent
Assumed office
October 12, 2021
PresidentJoe Biden
Preceded byKathy Kraninger
Commissioner of the Federal Trade Commission
In office
May 2, 2018 – October 12, 2021
PresidentDonald Trump
Joe Biden
Preceded byJoshua D. Wright
Succeeded byAlvaro Bedoya
Personal details
Born (1982-01-30) January 30, 1982 (age 42)
Plainfield, New Jersey, U.S.
Political partyDemocratic
Education
Signature

Rohit Chopra (born January 30, 1982) is an American consumer advocate who is the third director of the Consumer Financial Protection Bureau (CFPB) and previous member of the Federal Trade Commission (FTC). Prior to this, Chopra served as assistant director of the CFPB and as the agency's first Student Loan Ombudsman, an office created by the Dodd–Frank Act.[1]

In 2017, President Donald Trump nominated Chopra to fill the open Democratic seat on the Federal Trade Commission (FTC).[2] Chopra was unanimously confirmed by the U.S. Senate,[3] and was sworn in on May 2, 2018.[4] As a member of the FTC, Chopra supported agency efforts to scrutinize the practices of Big Tech companies such as Google and Facebook.[5]

Considered an ally of Senator Elizabeth Warren,[6] under whom he served at the CFPB, Chopra favors stronger oversight of banks and other financial institutions.[7] In 2021, he was chosen by President Joe Biden to serve as Director of the Consumer Financial Protection Bureau.[8][9] Chopra is closely associated with efforts to reform the system of student loans in the United States.[10][11]

Education and early career

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Chopra was born January 30, 1982, to an Indian-American family in Plainfield, New Jersey.[12][13] Chopra graduated from Harvard University in 2004, where he earned his Bachelor of Arts and served as president of the student body. According to The Wall Street Journal, Chopra was known by Harvard students for his "hard-charging style" with a "reputation for being a fierce advocate not afraid to clash with faculty interests".[14] While at Harvard, Chopra was resident of Adams House.[15]

After graduating from Harvard, Chopra attended the Wharton School of the University of Pennsylvania, where he received a Master of Business Administration in 2009.[12] Chopra was a recipient of a Fulbright Fellowship to South Korea.[16] Before entering government, he worked at McKinsey & Company, a global management consultancy firm.[17]

Early government career

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Consumer Financial Protection Bureau (CFPB)

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In the aftermath of the 2008 financial crisis and the passage of the Dodd–Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank"), Chopra worked on the implementation team that resulted in the creation of the Consumer Financial Protection Bureau (CFPB). At the CFPB, Chopra served as the agency's Student Loan Ombudsman and as the agency's assistant director.[18] During his tenure, the agency sued for-profit colleges Corinthian Colleges[19] and ITT Educational Services,[20] both of which dissolved.

Chopra is a vocal critic of the mounting levels of student loan debt in the United States.[21] In 2012, he released analysis revealing that outstanding student debt exceeded $1 trillion.[22] Chopra co-authored a report with Holly Petraeus that uncovered a student loan overcharging scheme impacting members of the military.[23] Chopra explained his focus on student loan policy to the Wall Street Journal, stating:

In my job, every day I get calls, emails, letters from people who are drowning in debt. I hear the panic in their voices as they worry about their financial future. They aren’t numbers on a spreadsheet. I want to help make things better for them.[14]

Post-CFPB career

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In 2016, Chopra joined the Department of Education as a senior advisor, where he worked under Under Secretary of Education Ted Mitchell.[24] Later in 2016, Chopra was named by Democratic presidential nominee Hillary Clinton as a member of her prepared presidential transition team, though her candidacy was ultimately unsuccessful.[25]

Chopra later became a Senior Fellow at the Consumer Federation of America (CFA), a consumer advocacy group.[16] In 2017, Chopra released a report showing that over 1 million Americans defaulted on a student loan in 2016.[26][27]

Federal Trade Commission (FTC)

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Chopra discussing the impact of student debt at a field hearing in Miami, Florida, in 2013

In 2017, Chopra was recommended by Senate Minority Leader Chuck Schumer to fill the open Democratic seat on the Federal Trade Commission (FTC).[16] Chopra was formally nominated to the position by President Donald Trump,[2] and was unanimously confirmed by the Senate on April 26, 2018. Chopra officially took office on May 2, 2018.[4] Upon taking office, Chopra became the second Asian-American to serve on the FTC, after Dennis Yao, who served from 1991 to 1994.[28]

During his time on the FTC, Chopra has supported efforts to scrutinize the business practices of "Big Tech" companies such as Google and Facebook.[5] In 2020, Chopra opposed the FTC's $170 million child privacy settlement with Google, arguing that the company was not sufficiently reprimanded for its actions. Chopra had previously opposed the agency's $5 billion settlement with Facebook following a probe of the company's data practices on similar grounds, believing it was an insufficient penalty.[29]

Chopra has stated that the federal government should "investigate how technology platforms may be a threat to our civil rights and the goals of fairness we seek in our society."[30] In 2020, Chopra co-authored a paper with Lina Khan, his former legal advisor,[31] in the University of Chicago Law Review titled "The Case for 'Unfair Methods of Competition' Rulemaking".[32]

Director of the Consumer Financial Protection Bureau (CFPB)

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Nomination

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During the 2020 presidential election, Chopra was mentioned as a possible candidate for a Cabinet position in a Biden administration. Chopra was mentioned as a contender for the position of Secretary of Commerce by Politico[33] and the New York Times,[33] but was ultimately nominated to serve as Director of the Consumer Financial Protection Bureau (CFPB).[9] Alvaro Bedoya, the Director of the Center on Privacy and Technology, went onto be confirmed as Chopra's replacement at the FTC.[34][35]

Chopra's nomination was praised by Senator Elizabeth Warren, who stated through her Twitter account that "I worked closely with Rohit [Chopra] to set up the CFPB and fight for America's students. It’s terrific that President-elect Biden picked Rohit to run the [CFPB]."[36] Chopra was confirmed 50–48 on September 30, 2021.[37] Vice President Kamala Harris cast a tie-breaking vote on the Senate's motion to invoke cloture on Chopra's nomination.

Tenure

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As CFPB director, Chopra serves as an ex officio member of the Federal Deposit Insurance Corporation (FDIC).[38] Since taking office, Chopra has scrutinized Big Tech companies' expansion into the payments sector. In one of his first acts in the position, Chopra ordered a probe into Amazon, Apple, Facebook, Google, PayPal and Block, Inc.-developed platform Square.[39] As CFPB director, Chopra has scrutinized bank overdraft fees.[40]

In October 2022, Chopra announced that the agency would begin data-sharing rulemaking on Section 1033 of the Dodd–Frank Act, which pertains to open banking.[41] In October 2023, the CFPB formally released its Section 1033 proposal, which if implemented would require banks to give consumers their financial data free of charge. The rule would forbid companies with access to users' personal financial information from collecting the data for targeted advertising.[42]

Controversies

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Under Chopra's watch, the CFPB has been the subject of some controversies.

A lawsuit in 2022 by the American Bankers Association and six other trade groups claimed Chopra was acting in a matter exceeding the agency's legal authority[43] which a WSJ investigation suggested was a mechanism to increase clout at the FTC and FDIC for the purpose of amassing power over businesses, banks, and consumers.[44]

In 2023 the agency failed to protect consumer data resulting in a data breach wherein an employee transferred personal information for 256,000 consumers from forty-five financial institutions.[45]

In January 2024, the agency settled a class action lawsuit brought by minority employees and women against Acting Director Mick Mulvaney in 2018. The employees alleged that they were discriminated against by the agency, which included being consistently paid less than their White male colleagues, being unfairly denied promotions, and facing retaliation for making discrimination complaints. As part of the settlement, the agency agreed to pay $6 million towards a settlement fund. The agency did not admit wrongdoing as part of the settlement.[46]

Under Chopra's leadership, the agency for the first time in its history failed to reach an agreement with the National Treasury Employees Union (NTEU) Chapter 335, which has resulted in employees working without a contract since December 31, 2023.[47] Agency employees are now the only federal workers who haven't received a raise or local cost-of-living increase in 2024, after President Biden authorized an average 5.2% pay raise for federal employees, the largest since the Carter administration.[48] The dispute centers on raising the salary ranges (pay bands) and the salary cap for workers, which the agency has thus far refused to do, despite agreeing in December 2022 to include pay bands and salary cap increases in this round of negotiations and Chopra raising the pay cap for agency executives in December 2023, some of whom are now paid as much as $269,000 a year.[49] By law, the Dodd-Frank Act provides that the agency has to maintain comparability as to compensation and benefits, not only with the Federal Reserve, but with the Federal Deposit Insurance Corporation (FDIC), the Comptroller of the Currency (OCC), and the Securities and Exchange Commission (SEC), among others.[50] The union maintains that raising pay bands and salary caps is essential for complying with the Act, since the Federal Reserve, OCC, and SEC raise these items annually and many already have substantially higher caps than the CFPB. On March 27, 2024, the National President of NTEU sent Chopra a letter, accusing him of avoiding all communication with union leadership, as negotiations drag on and remain stalled.[51]

References

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  1. ^ "Rohit Chopra · Consumer Federation of America". Archived from the original on April 27, 2018. Retrieved July 3, 2018.
  2. ^ a b "President Donald J. Trump Announces Intent to Nominate Personnel to Key Administration Posts". whitehouse.gov – via National Archives.
  3. ^ "Senate Cloakroom on Twitter". Retrieved July 3, 2018.
  4. ^ a b "FTC Fully Stocked As 3 More Commissioners Are Sworn In". Law360.com. Retrieved July 3, 2018.
  5. ^ a b Reardon, Marguerite. "FTC Democrat says agency should get more aggressive with big tech". CNET. Retrieved September 10, 2021.
  6. ^ Restuccia, Andrew Ackerman and Andrew (January 18, 2021). "Biden to Pick Rohit Chopra to Lead Consumer-Finance Agency". Wall Street Journal. ISSN 0099-9660. Retrieved September 10, 2021.
  7. ^ Lazarus, David (May 21, 2021). "Column: Biden, unlike Trump, thinks businesses shouldn't be free to abuse consumers". Los Angeles Times. Retrieved September 10, 2021.
  8. ^ "Biden taps Warren ally Chopra to lead Consumer Bureau". POLITICO. January 17, 2021. Retrieved January 18, 2021.
  9. ^ a b Ackerman, Andrew; Restuccia, Andrew (January 18, 2021). "Biden to Pick Rohit Chopra to Lead Consumer-Finance Agency". Wall Street Journal. Retrieved January 20, 2021.
  10. ^ Lieber, Ron (January 20, 2017). "6 Tips for Avoiding the Worst Student Loan Repayment Traps". The New York Times. ISSN 0362-4331. Retrieved September 10, 2021.
  11. ^ "COMMENT OF FEDERAL TRADE COMMISSIONER ROHIT CHOPRA" (PDF). Federal Trade Commission. September 18, 2019.
  12. ^ a b "S.Hrg. 115-761 — NOMINATIONS TO THE FEDERAL TRADE COMMISSION". www.congress.gov. Retrieved September 13, 2021.
  13. ^ "Indian American Rohit Chopra nominated as head of Consumer Financial Protection Bureau". The Economic Times. Retrieved September 10, 2021.
  14. ^ a b Andriotis, AnnaMaria; Zibel, Alan (December 4, 2014). "CFPB Official Speaks Loudly on Student Loans". The Wall Street Journal. ISSN 0099-9660. Retrieved September 10, 2021.
  15. ^ "Why We Love to Hate Harvard | Opinion | The Harvard Crimson". www.thecrimson.com. Retrieved September 2, 2024.
  16. ^ a b c "Schumer Recommends Consumer Advocate Rohit Chopra to the President to Serve as FTC Commissioner – Says Chopra is Eminently Qualified and has Been Putting Interests of Consumers First His Entire Career | Senate Democratic Leadership". www.democrats.senate.gov. May 9, 2017. Retrieved September 10, 2021.
  17. ^ "Rohit Chopra". Federal Trade Commission. April 30, 2018. Retrieved September 10, 2021.
  18. ^ "President-elect Biden nominates Rohit Chopra to serve as CFPB Director". Consumer Finance Monitor. January 18, 2021. Retrieved September 10, 2021.
  19. ^ "Special announcement for Corinthian students - Consumer Financial Protection Bureau". February 3, 2015. Retrieved July 3, 2018.
  20. ^ "CFPB Sues For-Profit College Chain ITT For Predatory Lending - Consumer Financial Protection Bureau". February 26, 2014. Retrieved July 3, 2018.
  21. ^ Andriotis, AnnaMaria; Zibel, Alan (December 4, 2014). "CFPB Official Speaks Loudly on Student Loans". Wall Street Journal.
  22. ^ Mitchell, Josh; Jackson-Randall, Maya (March 22, 2012). "Student-Loan Debt Tops $1 Trillion". Wall Street Journal.
  23. ^ Student loan servicing consumerfinance.gov
  24. ^ Halperin, David (January 13, 2016). "Rohit Chopra Joins Department of Education". HuffPost. Retrieved September 10, 2021.
  25. ^ Hefling, Kimberly; Stratford, Michael (August 30, 2016). "Clinton names Warren ally to transition team". POLITICO. Retrieved September 10, 2021.
  26. ^ Mitchell, Josh (March 14, 2017). "Student-Loan Defaults Rose by 1.1 Million in 2016". Wall Street Journal.
  27. ^ Berman, Jillian. "More than 1 million borrowers defaulted on their student loans last year". Marketwatch. Retrieved July 3, 2018.
  28. ^ Birnbaum, Emily (April 21, 2021). "What to watch at Lina Khan's confirmation hearing". POLITICO. Retrieved September 11, 2021.
  29. ^ Feiner, Jennifer Elias,Lauren (September 4, 2019). "YouTube will pay $170 million to settle claims it violated child privacy laws". CNBC. Retrieved September 10, 2021.{{cite web}}: CS1 maint: multiple names: authors list (link)
  30. ^ Chopra, Rohit (February 10, 2019). "Prepared Remarks of Federal Trade Commissioner Rohit Chopra - Silicon Flatirons Conference" (PDF). Federal Trade Commission.
  31. ^ "President Biden Announces his Intent to Nominate Lina Khan for Commissioner of the Federal Trade Commission". The White House. March 22, 2021. Retrieved September 10, 2021.
  32. ^ Chopra, Rohit; Khan, Lina (2020). "The Case for "Unfair Methods of Competition" Rulemaking". University of Chicago Law Review. 87.
  33. ^ a b Meyer, Theodoric (September 18, 2020). "How K Street sees a Biden presidency". POLITICO. Retrieved September 10, 2021.
  34. ^ "Biden taps privacy advocate Alvaro Bedoya for FTC". POLITICO. September 13, 2021. Retrieved September 13, 2021.
  35. ^ "On the Nomination (Confirmation: Alvaro M. Bedoya, of Maryland, to be a Federal Trade Commissioner)". US Senate. Retrieved May 11, 2022.
  36. ^ Warren, Elizabeth [@SenWarren] (January 18, 2021). "I worked closely with Rohit @ChopraFTC to set up the CFPB and fight for America's students. It's terrific that President-elect Biden picked Rohit to run the @CFPB. He's been a fearless champion for consumers at the FTC and will be a fearless champion leading the consumer agency" (Tweet). Archived from the original on September 10, 2021. Retrieved September 10, 2021 – via Twitter.
  37. ^ "On the Nomination (Confirmation: Rohit Chopra, of the District of Columbia, to be Director, Bureau of Consumer Financial Protection)". United States Senate. September 30, 2021. Retrieved September 30, 2021.
  38. ^ Reilly, Caitlin (December 19, 2022). "Senate confirms Gruenberg as FDIC chair, two others to join board". Roll Call. Retrieved December 20, 2022.
  39. ^ DeChiaro, Dean (October 26, 2021). "Chopra brings Big Tech scrutiny to new consumer protection post". Roll Call. Retrieved February 8, 2023.
  40. ^ Iacurci, Greg (December 1, 2021). "Financial watchdog cracks down on bank overdraft fees". CNBC. Retrieved December 24, 2023.
  41. ^ O'Donnell, Katy (October 25, 2022). "POLITICO Pro: Chopra: CFPB to draft data-sharing rule in 2023". Politico. Retrieved February 8, 2023.
  42. ^ "The power to walk away: CFPB moves to give consumers control over financial data". POLITICO. October 19, 2023. Retrieved December 24, 2023.
  43. ^ "ABA Sues CFPB for Abuse of Statutory Authority". www.aba.com. Retrieved March 1, 2024.
  44. ^ Ackerman, Ryan Tracy and Andrew. "How a D.C. Bureaucrat Amassed Power Over Businesses, Banks and Consumers". WSJ. Retrieved March 1, 2024.
  45. ^ O'Donnell, Katy. "CFPB says employee breached data of 250,000 consumers in 'major incident'". Politico. Retrieved March 1, 2024.
  46. ^ Johnson, Elliot (January 25, 2024). "CFPB Agrees to Pay $6M to Settle Discrimination Claims by Black and Hispanic Employees". Ballard Spahr LLP. Retrieved April 18, 2024.
  47. ^ Weinberger, Evan. "Pay Raise Fight at CFPB Boils Over Imperiling Wage Negotiations". Bloomberg Law. Retrieved April 18, 2024.
  48. ^ Wagner, Erich (December 21, 2023). "Biden signs order finalizing 5.2% pay raise for feds in 2024". Government Executive. Retrieved April 18, 2024.
  49. ^ Prescod, Paul. "Consumer Financial Protection Bureau Workers Want a Raise". Jacobin. Retrieved April 18, 2024.
  50. ^ Legal Information Institute, Cornell Law School. "12 U.S.C. 1833b - Comparability in compensation schedules". Cornell. Retrieved April 18, 2024.
  51. ^ Weinberger, Evan. "Union slams CFPB Head for Unacceptable Lack of Communication". Bloomberg Law. Retrieved April 18, 2024.
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