Dive Brief:
- President Donald Trump will nominate Jonathan McKernan to serve as the Treasury Department’s undersecretary of domestic finance and rescind McKernan’s nomination to lead the Consumer Financial Protection Bureau, according to the White House.
- The Treasury Department announced the intended appointment Friday, noting McKernan has been an adviser at Treasury while awaiting Senate confirmation to lead the CFPB. “During that time, McKernan has become an integral part of the Secretary’s senior team,” the release said.
- The White House, Treasury Department and CFPB didn’t respond to further inquiries on whether another CFPB nomination is forthcoming or why the switch for McKernan.
Dive Insight:
McKernan’s nomination to lead the CFPB has been pending in the Senate since March, after the Senate Banking Committee advanced his nomination by a 13-11 party-line vote.
McKernan would have needed 50 votes or more in the full Senate for confirmation and would have replaced Acting CFPB Director Russ Vought atop the agency, if confirmed.
In early April, Sen. Tim Scott, R-SC, the Senate Banking Committee chair, said the full Senate vote on McKernan’s nomination was “imminent,” estimating a vote in early May. Other nominees continue to await confirmation, including Jonathan Gould to lead the Office of the Comptroller of the Currency and Federal Reserve Gov. Michelle Bowman to serve as the central bank’s vice chair for supervision.
McKernan, a former Federal Deposit Insurance Corp. board member, resigned from that post in February. A day later, his CFPB nomination was announced. That came amid tumult at the CFPB, as Vought issued a stop-work order, closed the agency’s headquarters and attempted to gut the consumer watchdog’s workforce.
The “smaller, the better” for the CFPB, Scott said last month. “Everything we can do to shrink the size of the CFPB, the better off the average consumer is,” he said.
Scott inferred the administration wanted to “get as much of that work done before we had a permanent guy come in and take it over.”
“And I do think we are at the point where it’s time to move forward,” Scott said at the time.
During McKernan’s nomination hearing before the banking committee, Democrats pointed to the Trump administration’s efforts to hobble the agency and told McKernan he might be taking on an “unenviable” position atop the CFPB. “It kind of feels like you’ve been lined up to be the No. 1 horse at the glue factory,” Sen. Elizabeth Warren, D-MA, the committee’s ranking member, said to McKernan.
Democrats also pressed McKernan on who would really be in charge of the CFPB because, during the nomination hearing, Vought dismissed a lawsuit after McKernan had told lawmakers he planned to review the CFPB’s pending litigation if confirmed.
In a February court filing, the Trump administration said it didn’t intend to shutter the bureau, pointing to McKernan’s nomination as evidence to support that.
In an emailed statement Monday, Scott said he was “not surprised that Jonathan has become an integral part of Secretary Bessent’s senior team, and I look forward to supporting him for Undersecretary of Domestic Finance at the Treasury Department.”
Warren didn’t respond to a request for comment Monday. On Friday, Warren, Senate Minority Leader Chuck Schumer and dozens of other Senate and House Democrats filed an amicus brief with the D.C. Circuit Court, in the National Treasury Employees Union’s case against Vought, railing against the Trump administration’s attempts to decimate the CFPB.
Nellie Liang held that Treasury role during the Biden administration.
Prior to the FDIC, McKernan served as a counsel to former Sen. Pat Toomey, R-PA, on the Senate Banking Committee staff, a senior counsel at the Federal Housing Finance Agency, policy adviser at the Treasury Department and to former Sen. Bob Corker, R-TN, and a short stint at the CFPB.
The Treasury role will ensure McKernan’s “experience and expertise are best put to advancing the President’s America First agenda,” according to Treasury’s release Friday.
