Biden to tap Wall Street critic Omarova as top bank cop

President Joe Biden is poised to nominate Cornell Law School Professor Saule Omarova to a top job overseeing the nation’s banks, according to a person familiar with the matter, handing a win to advocates for stricter financial rules.

As comptroller of the currency, Omarova would be responsible for policing the activities of the U.S.'s largest banks as the head of a key financial regulator. She would also set rules affecting the operations of upstart financial technology companies and cryptocurrency firms.

In her academic work, Omarova has long called for the government to play a more expansive role in providing financial services, questioning whether traditional lenders and their newer competitors are adequately serving the needs of Americans.

Omarova has written in favor of restructuring the Federal Reserve and recommended that it provide bank accounts for consumers, which she has argued would make the financial system “less complex, more stable and more efficient in serving the long-term needs of the American people.” That view is likely to make her nomination controversial, particularly for Senate Republicans.

Earlier this year, she told POLITICO that large financial institutions “hold so much power now and they move so much money through their own channels that it is effectively impossible through just rules and some enforcement to really shape what it is they’re doing.”

She has also expressed skepticism that so-called fintech companies and cryptocurrencies can provide the type of disruptive benefits to consumers that they promise.

“What we should be really thinking about is, what should we do to shift that balance and have the Fed and have the Treasury and have maybe other public institutions maybe take a greater part in the infrastructure itself, in the provision of financial services,” she said. “We need to bring more adults into the room, the adults meaning the public.”

Neither Omarova nor the White House responded to requests for comment. News of her selection as head of the Office of the Comptroller of the Currency was earlier reported by Bloomberg and the Wall Street Journal.

Omarova’s selection continues a trend of financial regulatory nominees who have pleased the left, including Consumer Financial Protection Bureau nominee Rohit Chopra and Securities and Exchange Commission Chair Gary Gensler, though progressives have also expressed exasperation at the slow pace that some of these nominations have happened.

The news also comes as financial observers await a decision on whether Biden will reappoint Jerome Powell as chair of the Federal Reserve, another key bank regulator. The position of Fed vice chair of supervision, the central bank’s regulatory czar, is also set to open up next month, and activists have been pushing hard for an aggressive regulator to be tapped for that role.

Omarova, who is originally from Kazakhstan, would be the first woman and first person of color to run the OCC on a permanent basis. Her impending nomination puts a cap on a drama that has played out during the Biden administration over who should get the nod as comptroller.

Biden’s initial leading candidate — former Treasury official Michael Barr — was not nominated after his consideration triggered a backlash from progressive Democrats, who instead pushed law professor Mehrsa Baradaran for the job. In the meantime, the OCC has been led by acting Comptroller Michael Hsu, a former Federal Reserve official.

Omarova served at the Treasury Department under President George W. Bush and previously worked as a lawyer at Davis Polk, where she specialized in a variety of corporate transactions and advisory work in the area of financial regulation, according to her Cornell bio.