Biden’s controversial anti-crypto Comptroller nominee withdraws

December 8, 2021 Coin Telegraph

Saule Omarova backed out of her nomination to be the Comptroller of the Currency amid a blizzard of scrutiny over her positions on crypto and banking.

The Office of the Comptroller of the Currency in the USA will operate with only an acting Comptroller for a little longer after President Biden’s nominee, Saule Omarova, withdrew her candidacy from the confirmation process.

In response to Omarova’s withdrawal, President Biden said on Dec. 7, “Saule was subjected to inappropriate personal attacks that were far beyond the pale.”

The Comptroller of the Currency oversees the regulation of chartered banks across the country. Cryptocurrency stakeholders saw Omarova as a poor choice for the Comptroller due to her anti-crypto sentiments.

Omarova fielded heated lines of questioning from Republican and some Democratic senators on The Committee on Banking, Housing, and Urban Affairs in hearings about her views on private banking and cryptocurrency regulation.

Some Republicans, such as Senator John Kennedy focused on Omarova’s upbringing in the Soviet Union.

During Nov. 18 in Senate hearings, Republican Senator Cynthia Lummis questioned Omarova on her position regarding cryptocurrency and stablecoins. Omarova expressed concern that eventually private tech companies that deploy the stablecoin infrastructure would put private profit-based interests above the public need for open banking.

When asked whether she believes that government-issued fiat currency is superior to private commerce, Omarova responded:

“I worry about allowing private innovation to undermine a lot of important public policies that we need to pursue.”

Omarova attended Moscow State University in Moscow, Russia on the V.I. Lenin Personal Academic Scholarship where she reportedly wrote a thesis about Karl Marx. The thesis was featured on Omarova’s resume in April 2017. Republican Senator Pat Toomey was told that the thesis was deleted, and therefore it could not be produced.

Republican Senator Mike Crapo challenged Omarova to explain her position on federally chartered banks as they pertain to climate change. She advocates for the banking system having the power to put climate change-contributing industries, which she had referred to as “socially sub-optimal industries,” out of business by preventing them accessing to bank loans.

Her position states, “the way we get rid of these carbon financers is we starve them of their source of capital.”

In light of Omarova backing out, President Biden will have to nominate another candidate for the Comptroller.

Senator pressures OCC nominee over missing Marxism thesis from Moscow Uni

October 7, 2021 Coin Telegraph

Coin Telegraph

“I don’t think I’ve ever seen a more radical choice for any regulatory spot in our federal government,” said Senator Pat Toomey.

Pat Toomey, a Republican member of the U.S. Senate Banking Committee, is attempting to pressure the nominee to head the Office of the Comptroller of the Currency (OCC) into handing over her 1989 university honors thesis about Karl Marx.

The Biden administration formally nominated Kazakh-born attorney Saule Omarova — who has been characterized by critics as both anti-bank and anti-crypto — to head the financial regulator on Sept. 29. In vague echoes of McCarthyism, Toomey believes the thesis may show that Omarova has sympathies toward Marxist views.

While Omarova has lived in the US since 1991 and previously served as an advisor to George W. Bush, she previously attended Moscow State University during 1988 and 1989 on The Lenin Personal Academic Scholarship.

In an open letter to Omarova published on Oct. 5, Toomey claimed that she had deleted reference to her thesis “Karl Marx’s Economic Analysis and the Theory of Revolution in The Capital” from her current resume with Cornell Law School, adding that the paper was featured on her resume in April 2017.

The archived resume indicates that the paper was written as part of Omarova’s diploma with honors in philosophy. Toomey states he is requesting the document so that the Senate Committee on Banking, Housing, and Urban Affairs can “fully assess the fitness of individuals to serve in Senate-confirmed executive and independent agency positions.”

He said committee staff had first requested the document from Omarova in September but, “we have not received any assurances that the Committee would receive a copy of the paper in a timely fashion.”

The Biden administration has received criticism over Omarova’s nomination, with detractors pointing to her 2020 statements cheering for lawmakers to “effectively end banking as we know it.” Omarova has also characterized cryptocurrency as a symptom of the existing “dysfunctional financial system.”

However, Democrats have praised Biden’s pick for the nomination, with Senator Elizabeth Warren describing Omarova as “an excellent choice to oversee and regulate the activities of our nation's largest banks.”

Speaking to the committee on Oct. 5, Toomey described Omarova as an extreme “radical” whose recent policy prescriptions have included state-directed pricing for wages and good, nationalizing the retail banking industry, and an overall “aversion to anything like free market capitalism.” He continued:

“In 2019, she tweeted, ‘say what you will about the old USSR, there was no gender pay gap there. Market doesn’t always know best [...] Ms. Omarova clearly knows her views are far outside of the mainstream."

Senator Ted Cruz also took aim at Omarova of the potential threat she may pose to crypto, tweeting: “Not only is Saule Omarova, Biden’s pick to lead the OCC, a threat to our traditional economy, she also wants to regulate crypto into oblivion. Crypto faces future-defining government regulations. This nomination needs to be stopped.”

Opposition mounts to Biden’s OCC pick, fears she could ‘regulate crypto into oblivion’

September 29, 2021 Coin Telegraph

Banking

Texas Senator Ted Cruz is among a number of politicians and bankers that are opposed to the nomination of Saule Omarova.

Resistance is mounting to U.S. President Joe Biden’s reported plans to tap a staunch banking and crypto critic to run the Office of the Comptroller of the Currency (OCC).

The proposed nomination of law professor, Saule Omarova, to head the federal bank regulatory agency has raised eyebrows in political and financial circles as she is widely seen as anti crypto and anti big banks.

Texas Republican Senator Ted Cruz has become the latest crypto ally to speak out, claiming that her decisions, if nominated, could change the future of the industry in a tweet on Sept. 28.

“Not only is Saule Omarova, Biden’s pick to lead the OCC, a threat to our traditional economy, she also wants to regulate crypto into oblivion. Crypto faces future-defining government regulations. This nomination needs to be stopped.”

A number of big banks and banking associations are also against the nomination with the American Bankers Association debating whether to publicly fight the decision. ABA President and CEO Rob Nichols said “we have serious concerns about her ideas for fundamentally restructuring the nation’s banking system,” in a statement on Sept. 24.

Ranking Republican on the Senate Banking Committee, Pat Toomey, also spoke out in opposition of the nomination last week stating that he has “serious reservations” given her “extreme leftist ideas.”

President and CEO of the Independent Community Bankers of America, Rebeca Rainey, said that Omarova “would displace locally-based community banking and restrict economic growth in local communities,” according to reports.

The OCC oversees America’s banking giants such as Goldman Sachs, JPMorgan, and Citi Group and would also encompass aspects of the crypto industry.

Omarova, who has previously said she wanted to “end banking as we know it,” is expected to enforce stricter rules. She has also claimed that the rise of cryptocurrencies is “benefiting mainly the dysfunctional financial system we already have.”

She shares views with anti-crypto lawmakers such as Senator Elizabeth Warren in that digital assets threaten to destabilize the economy, according to Bloomberg. For her part, Warren stated that the nomination was “tremendous news,” and looked forward to heavier regulations.

The OCC has morphed from one of the Treasury’s most crypto-forward agencies into one that changed direction under subsequent leadership. Former head of Coinbase’s legal team, Brian Brooks, joined the OCC in March 2020 and paved the way for legislation allowing banks to custody crypto.

In January, the banking regulator told national banks that they could run independent nodes for distributed ledger networks such as stablecoins. However, then the tone changed. On Sept. 21 acting head of the OCC, Michael Hsu, warned that decentralized finance products are similar to those that catalyzed the global financial crisis in 2008.

Biden to nominate anti-crypto and anti-big bank law professor to run the OCC

September 23, 2021 Coin Telegraph

Biden Administration

Omarova has stated she hopes to “end banking as we know it” but believes large financial firms can abuse the crypto market outside of regulators’ view.

The Biden administration reportedly intends to nominate Kazakhstani-American attorney, academic and former policy advisor Saule Omarova to head the Office of the Comptroller of the Currency (OCC) — the institution that oversees the U.S. banking sector.

Omarova has levied criticisms at both crypto assets and the legacy banking sector in the past, having once pledged to “end banking as we know it”. She has characterized cryptocurrency as “benefiting mainly the dysfunctional financial system we already have.”

According to a Sept. 22 report from Bloomberg citing three anonymous sources “familiar with the nomination process,” Omarova could be nominated as soon as this week.

Currently working as a law professor at Cornell University Law School, Omarova is expected to seek tighter regulations for crypto as she has described the sector as threatening the stability of the economy and ripe for abuse from large private financial entities. The academic specializes in banking law and corporate finance.

If confirmed, Omarova’s tenure at the OCC would likely comprise a significant shift from the previous administration, with former Coinbase legal officer and crypto proponent Brian Brooks having headed the agency toward the end of Trump’s presidency.

Omarova has also offered radical prescriptions for the finance industry, having advocated for consumer banking services to exclusively be administered by the Federal Reserve rather than private institutions. She previously served as a special adviser for regulatory policy to the U.S. Treasury Department during George W. Bush’s presidency.

However, analysts don’t believe Omarova will get the OCC jobwithout a fight, with the Democrats currently holding a slim majority in the Senate and the banking sector expected to lobby against her appointment.

If appointed, Omarova would become the first woman to formally lead the agency, although the OCC has been directed by a female acting head in the past.

The New York Times reported that the Biden administration had started vetting Omarova for the role in early August.

While the Democrats were previously considering former Treasury official Michael Barr and law professor Mehra Baradaran for the role, they were dropped after the Democrats decided neither candidate was likely to garner enough support to secure confirmation.

Saule Omarova

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