President Joe Biden‘s nominees to lead the Securities and Exchange Commission and the Consumer Financial Protection Bureau faced tough questions from the Senate Banking Committee during their confirmation hearing Tuesday. Gary Gensler, nominated to head the SEC, and Rohit Chopra, chosen to head the CFPB, were asked to address some of the most controversial issues in finance today, including the ideal regulatory response to the meme-holding phenomenon. , the debate on students. loan forgiveness and how financial regulators must address pressing issues such as climate change and economic and racial inequality.
The ranking Republican on the committee, Pennsylvania Sen. Pat Toomey, lobbied Gensler on progressive proposals for the SEC to require companies to disclose information related to climate change. He asked Gensler if he thinks the SEC could require a company whose energy bills are not financially important to report how much energy they get from renewable sources. Gensler said disclosure requirements will be based on the concept of materiality, and that while a single piece of information may not be material in and of itself, materiality must be viewed in the context of the “total information mix” that an investor reasonable you might think. material for its investment decisions, leaving open the door that Gensler could pursue by requiring climate disclosures if confirmed. Pressed on whether the SEC should require companies to disclose information about workforce diversity, Gensler seemed eager to seek ways to force companies to disclose workforce information more generally. “I think human capital is a very important part of the value proposition in many companies,” Gensler said. Chopra answered several questions about the CFPB’s qualified mortgage rule, which requires lenders, before making a residential mortgage loan to a consumer, to make a reasonable good faith determination of the consumer’s ability to repay the loan in accordance with its terms. “The CFPB is not here to dictate the home finance policy, it is to make sure that the prohibitions are followed when it comes to our mortgage laws, and when it comes to QM, it is important that we balance the consumer protections that Congress has implemented with access ”to home loans, Chopra said. “We don’t want to go back to what we saw in the years before the financial crisis.”