Brown Opening Statement at Banking Committee Hearing on Nominations to the SEC, Ginnie Mae, HUD and OFR

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 hearing on nominations to the Securities and Exchange Commission, Government National Mortgage Association, Department of Housing and Urban Development and Office of Financial Research.

 

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

Thank you, Chairman Crapo, for holding today’s hearing on the nominations of Mr. Elad Roisman, Mr. Michael Bright, Ms. Rae Oliver, and Dr. Dino Falaschetti. I look forward to hearing their views and would like to welcome their families to the Committee.

Ms. Roisman has been nominated to be a Commissioner of the Securities and Exchange Commission.  If confirmed, Mr. Roisman would return to the SEC and continue the public service he began there.

His time at the SEC and on the Banking Committee provide him with an understanding of the challenges facing the agency and the markets.  Although I expect Mr. Roisman to face many difficult issues, if he is confirmed, I hope that he pays particular attention to the downward trend in enforcement actions and penalties. 

The SEC must emphasize integrity and fairness in the capital markets, in order for investors to have faith in the markets and in the regulator. 

Market participants need to see meaningful efforts by the SEC to enforce the law and punish bad actors.  Ten years after the financial crisis, we are reminded that regulators failed to hold any senior executives accountable for the widespread misconduct that devastated millions of families. 

Tough enforcement policies can discourage wrongdoing and maybe even help avoid the practices that led to the last crisis.  Mr. Roisman, I hope that you will do everything you can to make strong enforcement a priority.

Mr. Bright is a fellow Ohioan and is also no stranger to this Committee. He advised Senator Corker on Committee issues from 2010 to 2014, including proposals to reshape the housing finance system.

He has held many roles in the housing finance industry, including his current position as the Executive Vice President and Chief Operating Officer of the agency he has been nominated to lead, Ginnie Mae.

For 50 years, Ginnie Mae has facilitated access to affordable loans through the FHA, VA, and USDA mortgage programs by connecting federally-insured loans to investors around the world. Today, more than 10.7 million households have access to affordable mortgage credit and rental housing because of Ginnie Mae.

I have been encouraged that, under Mr. Bright’s leadership, Ginnie Mae has strengthened its risk management and continued to adjust to an evolving home lending market.

But I have questions for Mr. Bright about his work and the policies he advocated before his nomination, and how this will inform his vision for Ginnie Mae.

HUD’s Office of Inspector General plays an important role in ensuring the integrity and effectiveness of HUD programs. The Inspector General serves as an independent check on the agency, working to ensure that HUD’s programs and personnel are accountable to taxpayers and advance the mission that Congress has given HUD to assist our families and communities.

If confirmed, Ms. Oliver would bring years of investigative experience to the role of Inspector General.  I look forward to hearing her testimony today. 

Dr. Falaschetti has been nominated to be the Director of the Office of Financial Research.  OFR was established by the Wall Street Reform Act to monitor and study emerging risks to the financial system and to support the work of FSOC. 

As both Congress and the regulators make changes to rules that roll back the strong post-crisis regulations, the OFR’s analysis of market trends and potential gaps in regulators’ view of risks is critical to financial stability.   

Dr. Falaschetti, I know you’ve been a skeptic of regulation in the past.  If confirmed, I hope that you will take OFR’s mandate seriously. Hard-working Americans cannot afford another crisis, and whatever OFR can do to monitor risks will benefit everyone.

Not seeing the signs of the next crisis would be bad enough, but to miss them because the office created to study systemic risk doesn’t have resources it needs is inexcusable. 

I look forward to your testimony.

Thank you, Chairman Crapo.

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