Eric Blankenstein, a top Consumer Financial Protection Bureau lawyer who came under fire last year over past writings that were viewed as racist, plans to step down at the end of the month, according to sources familiar with the matter.

A former associate at Williams & Connolly, Blankenstein joined the CFPB in late 2017 under the leadership of the agency's Trump-appointed acting director, Mick Mulvaney, who has since become the interim White House chief of staff. As a senior adviser to Mulvaney, Blankenstein took a lead role reviewing the CFPB's pending investigations and cases, presiding over a period in which the bureau ratcheted down its once-aggressive enforcement efforts.

A senior CFPB official confirmed that Blankenstein informed the bureau leadership that he is leaving to take another opportunity. Blankenstein did not immediately respond Wednesday to a message seeking details about his next steps.

Blankenstein was widely criticized last year after the Washington Post revealed past writings in which he questioned, under a pen name, whether use of the N-word was inherently racist and claimed that the majority of hate crimes were hoaxes. A union representing CFPB employees condemned the writings, saying they “indicate that he is unfit for any leadership position in the federal government.”

Blakenstein apologized for his remarks, writing in an email to colleagues that the tone and framing of his past statements “reflected poor judgment” and that he regretted “some of the things I wrote when I was 25.”

His planned departure comes within six months of the agency's new director, Kathy Kraninger, being confirmed to a five-year term. Kraninger has expressed support for Blankenstein, stating publicly she would not hold the years-old comments against him.

Kathy Kraninger CFPB Director Kathy Kraninger testifies before the House Financial Services Committee. Credit: Diego M. Radzinschi/ALM

On her first day at the bureau, in December, Kraninger said, “I will take people at face value and where they are today and what they're doing for the bureau.”

Blankenstein's departure plans were earlier reported by Bloomberg Law.

Blankenstein joined the CFPB from the Office of the U.S. Trade Representative, where he had worked briefly in late 2017 before becoming a top Mulvaney adviser. The University of Virginia School of Law graduate had been an associate at Williams & Connolly since July 2009.

Before joining the CFPB, Blankenstein had litigated against it in defense of TCF Bank in an enforcement action in Minnesota federal court.

The bank, represented by Williams & Connolly, Dykema Gossett and Buckley LLP, known at the time as Buckley Sandler, agreed last year to pay $30 million to resolve allegations that it misled consumers about overdraft fees. Blankenstein was recused from the case after joining the CFPB, a bureau representative confirmed at the time.

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