A Brookings Institution study published last year found that only 10 of the 327 people on the governing boards of U.S. financial regulatory agencies are Black. Chris Brummer, the author of the report and a professor at Georgetown University, said the problem with financial regulators being mostly white is that they also set rules in the financial realm for people of color.
Some agencies, like the Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Corporation, make up an interwoven network of regulators whose members set the rules for everything money-related. There is a risk that they would enact policies that could hurt Black and Hispanic families.
President Joe Biden has taken steps to diversify financial regulators. He nominated Sandra Thompson as director of the Federal Housing Finance Agency and Kristin Johnson for a post on the Commodity Futures Trading Commission. Biden also appointed several Black Americans to high positions at other federal agencies, including Shalanda as director of the Office of Budget and Management.
But despite Biden’s efforts, many financial regulatory agencies remain predominantly white. For example, the Municipal Securities Rulemaking Board has 17 board members, 13 of which are White. The SEC has five board members, all of which are white. And the Federal Reserve’s board of governors is entirely white.
To help address the issue Reps. Al Green of Texas and Maxine Waters of California introduced bills to add more people of color to the financial industry and its regulating ranks. Green emphasized that it is impossible to narrow the racial wealth gap without increasing the diversity of federal financial regulatory bodies.