September 07, 2017

Brown Opening Statement at Banking Committee Executive Session


WASHINGTON, D.C. — U.S. Sen. Sherrod Brown (D-OH) – ranking member of the U.S. Senate Committee on Banking, Housing, and Urban Affairs – released the following opening statement at today’s Executive Session to vote on Mr. Joseph Otting to be Comptroller of the Currency, The Honorable Randal Quarles to be a Member of the Board of Governors of the Federal Reserve System and S.1463, Financial Stability Oversight Council Insurance Member Continuity Act.

Brown’s remarks, as prepared for delivery, follow:

Thank you, Chairman Crapo. 

Since this is our first hearing in the Committee since Hurricanes Harvey and Irma I want to start off by offering my condolences to all those who lost loved ones from these devastating events. I also want to thank the many Americans who have offered their help to those who are most in need. 

Senator Crapo and I and many of our colleagues have been working to reauthorize the National Flood Insurance Program, and that work will continue.

But right now, the most important priority is making sure that we fulfill our commitment to policyholders and act quickly to cover claims from families devastated by Hurricane Harvey and Irma.  We must ensure the NFIP has the funds it needs to pay claims and the authority to continue beyond the end of the month.  I hope we move quickly to ensure the continuation of the program, as Senator McConnell has proposed in the amendment he filed last night.

It is also timely that today we will consider nominations of Randal Quarles to be the Vice Chair of Supervision at the Federal Reserve Board, and Joseph Otting to be Comptroller of the Currency. Both agencies play a role in ensuring that financial institutions help homeowners rebuild and take steps to prepare for the next disaster.

I also want to briefly acknowledge and thank the current Vice Chair of the Federal Reserve Board Stan Fischer for his service.  He announced his resignation from the Board yesterday, and Americans will miss his broad and deep experience. 

Today we will consider one nomination to the Federal Reserve, but because this Committee refused to consider Obama’s nominees to the Federal Reserve Board last Congress, there will still be three additional vacancies.

While I appreciate both nominees’ willingness to enter public service, I do not think either nominee is the person we want in these important roles at our financial watchdogs.  With additional vacancies at the Fed and other agencies, I fear more of the same type of nominees from the Administration.

The financial crisis devastated Ohio communities and communities across the nation with lost jobs, foreclosed homes, and evaporated savings.

We’ve made a lot of progress in the seven years since we passed Wall Street reform, and the last thing we need are people at the Federal Reserve and Office of the Comptroller of the Currency who are supposed to look out for our financial system, instead working to weaken or eliminate important safeguards.

Mr. Quarles served as Treasury’s Undersecretary for Domestic Finance in the years leading up to the 2008 financial crisis. It was his job to coordinate oversight of the financial industry.

However, many of his statements leading up to the crisis were far too credulous when it came to industry claims that we need not worry about a credit bubble.

I am not confident that Mr. Quarles took to heart the costly lessons of the financial crisis.  He seems far too ready to relax the rules for Wall Street and those that protect consumers. 

Mr. Otting had a different role during the crisis. Instead of helping families recover from the financial crisis, as CEO of OneWest Bank, he contributed to the devastation. 

Mr. Otting’s bank made money by kicking seniors and families out of their homes, while pocketing $2.5 billion from the FDIC to protect his bank from these losses. 

According to the Columbus Dispatch, nearly 2,000 Ohioans – in just our six largest counties – were foreclosed on by OneWest from 2009 to 2015.

Both Mr. Otting and his boss at OneWest, Treasury Secretary Mnuchin, continue to refuse to provide members of the Senate with information we requested about the number of families foreclosed upon in each state by the bank. 

This is troubling. If confirmed, Mr. Otting will be in charge of ensuring all national banks, including banks like Wells Fargo, are complying with the law, operating in a safe and sound manner, and protecting consumers.

It is clear that today’s nominees have a great deal of experience working for banks – but that’s exactly the problem. 

If confirmed, will Mr. Quarles and Mr. Otting begin working for American taxpayers and working families, or will they continue working for Wall Street? I don’t think that’s at all clear.

Last, the bill we are marking up today is a good example of how we can work in a bipartisan way to find consensus on parts of Dodd-Frank that don’t quite work as planned. 

This bill will ensure that the FSOC continues to have an independent insurance member until a new individual is nominated by the President and confirmed by the Senate. I thank Senator Crapo for working with me on this, and Senators Cortez Masto, Cotton, Heller, Menendez, Perdue, Rounds, Scott, Tester, Tillis, Van Hollen, Warner, and Warren for cosponsoring.


Thank you, Mr. Chairman.