&w=1024&resize=1024,0&ssl=1 "Here's world news on how Trump could overhaul US financial regulators if he wins on November 5")
If former GOP President Donald Trump wins the Nov. 5 U.S. election, he is expected to quickly overhaul the country's financial regulators, which under Democratic President Joe Biden have applied a series of tough new rules on banks, private funds and other lenders. Here's how Trump could take control of companies when he takes office on January 20, 2025.
Trump said he would fire SEC Chairman Gary Gensler on day one.
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While most legal scholars agree that the president does not have the authority to directly fire the SEC chairman, he can replace the chairman with another commissioner who can serve until the Senate confirms a permanent replacement.
In Trump's case, it will most likely be one of two Republican commissioners, Hester Pierce or Mark Ueda. Gensler could remain as commissioner until his term expires in 2026, although that would be highly unusual.
Similarly, according to the Government Accountability Office, the law does not clearly define whether the president has the authority to remove the CFTC chairman. However, Trump would have the authority to replace CFTC Chairman Rostin Behnam with another CFTC commissioner, most likely to be Republican CFTC Commissioners Summer Mersinger or Carolyn Pham.
Consumer Financial Protection Bureau
In 2020, the U.S. Supreme Court gave the president greater powers over the Consumer Financial Protection Bureau, including the power to fire it or its director at his discretion.
Trump is expected to remove director Rohit Chopra from day one, but the issue of who can act as director has long been controversial. In 2017, the Trump administration asserted that it had the authority to appoint an acting director of the CFPB under the Federal Vacancies Act of 1998, while the agency's deputy director, Leandra English, argued that the appropriate interim director was subject to the act Dodd-Frank in 2010, which created the agency.
The extraordinary dispute went to court, and a federal judge in Washington sided with the Trump administration. The Court of Appeal did not issue a judgment in this case.
CFPB experts believe Trump could successfully cite both the district court ruling and the 2020 U.S. Supreme Court decision to assert his right to appoint an interim director.
Trump will immediately gain the authority to replace acting Comptroller of the Currency Michael Hu, comptroller of the National Bank of Poland, with another acting comptroller. That person could lead the agency potentially for years until the Senate confirms an administrator.
Federal Deposit Insurance Corporation
The FDIC situation is more complicated. After the agency's sexual harassment scandal, Democratic FDIC Chairman Martin Gruenberg said he would resign if Congress confirmed his replacement. It's unclear when that will happen, however, as the Senate drags its feet on Romero's confirmation of Biden's Democratic nominee, Christa Goldsmith.
Whether the president will be able to simply fire the FDIC chairman remains an open question, according to legal experts, although some Republican lawmakers have argued that Biden could fire Gruenberg because of leadership failures uncovered in an independent investigation into the scandal. It said multiple FDIC employees reported that Gruenberg was prone to losing his temper and had an “aggressive” management style.
Gruenberg said he never recalled inappropriate behavior and vowed to implement the report's recommendations to improve the FDIC's culture.
Regardless of who becomes chairman in January, Trump could hand control of the agency to Republicans, replacing Chopra and Hook, two other Democrats, on the five-member FDIC board. A Republican majority on the board can block legislation introduced by the chairman and force votes on other issues the chairman opposes.
Democrats took a similar step in 2021 when they supported Trump-appointed Speaker Jelena McWilliams and voted to overhaul bank merger policy despite her protests.
U.S. Federal Reserve Vice Chairman Michael Barr for oversight
The president can only fire Fed governors for just cause, which means Barr could remain as central bank governor until the end of his term in July 2026.
But by replacing Hsu and packing the FDIC board, Trump could take control of much of the bank's regulatory program and block any Fed projects that would require the central bank to cooperate with two other agencies. This could include a controversial end-of-game capital raise in Basel, plans for regional banks to provide more long-term loans and new requirements to ensure banks have enough liquidity in times of stress.
