Name: Thomas Schumpert
Occupation: Director, Rhode Island Department of Business Regulation
Backround: Most recently president and founder of TS Associates, Inc., a Boston management consulting practice. Former president of the Massachusetts Minority Enterprise Investment Corp. Served as senior vice president at two banks, including Bank of New England in Boston, and assistant vice president at Fleet National Bank in Rhode Island. Served in the U.S. Air Force in Vietnam from 1965 to 1966.
Education: Management degree from Rutgers University.
Age: 58
Family: Divorced, two dautghters, one grandson
Residence: Cumberland
PBN: What sort of things have you been doing here to get acclimated to the job?
SCHUMPERT: Reading. Meeting with a lot of people both within the administration, within the department here, as well as meeting with trade groups.
Banking is your area of expertise, but what about these other industries you regulate, such as health insurance. Is that difficult to get used to?
In four weeks, I’m still getting acclimated. It’s different, but remember that DBR regulates in addition to the legal aspect, the financial aspect. The financial solvency, whether it is an insurance company or a manufacturer, there is a common comfort that I have there. And beyond that I’ve been blessed with a good staff. The professionals here when I ask questions – why? let me understand this? — they answer those questions. Also, I’ve made a number of visits with trade groups. I’m calling on people that we regulate to understand their business.
What has the response been in the community with the groups you’ve been talking with do they want to know more about DBR, or more about you?
I think the people I have met with mostly are people who want to know Tom Schumpert, what kind of person he is. The law is not going to change just because you’ve got a new DBR director. The professionals that are here at DBR are not going to change just because I’m here. So now the business people that I’ve met with are more curious about what kind of person is this fellow that I’m going to be dealing with? They know the law, their lawyers know the law, my people know the law. They have relationships with my staff here. I think there’s a greater curiosity about the individual. They know Anthony (Arico, deputy director) because he’s been here a long time, they know Al (Mastrostefano) in insurance, Dennis (Ziroli) in banking. So it’s how’s this guy who is new at the helm of this organization, how’s he going to be?
Have you figured out for yourself yet what you think are some of DBR’s more important tasks?
One of the observations I have made is that we in the next few years have a real opportunity to enhance our technology. Now it might sound stupid, but that computer telling me ‘you’ve got a 3 o’clock meeting’ is kind of nice. It doesn’t cost anything more. But the use of technology is one of the areas that I think that DBR (can improve), and as I talk to industry representatives, they like the idea. It may be simple, but they like the idea that if they want to be in touch with me they can send me an e-mail. It’s quick, it’s efficient, and it is a new millennium. Talking to my staff here about what it would be like if DBR could be more accessible through technology, it is one of the platforms I see.
Obviously the changes in industry, consolidation that’s going on in the banking industry and the insurance industry. Both major employers, both major regulatory clients of DBR. We’ve got to stay abreast of that. That means training for our people and a lot of it is going to be technology driven.
At four weeks into the job among the areas I see is just keeping abreast of the rapid changes in the industries we regulate. Trying to balance regulation of industry with the need for jobs for people of Rhode Island. That to me is the balancing act that I have to focus on, and it’s much broader than I had when I was a banker.
During your confirmation hearing, Senate Judiciary Committee members asked you a lot of consumer-oriented questions, of particular interest were ATM fees and the proposed Fleet-BankBoston merger. At the time, you had only limited time to research. I was wondering if you’d gone back to research their concerns?
First of all I went back and reviewed the tape of that, because there were some good questions raised. Obviously DBR has no say over a federal charter (bank). But we have been working on it. I went up to Boston to observe firsthand, as an individual not a participant, the Federal Reserve hearing. Myself and my banking chief went there, we went there to listen so we could have a firsthand understanding of what was being said.
Obviously in Rhode Island we will be impacted by the (Fleet-BankBoston) merger along with everyone else. I have done a lot, along with my banking superintendent, to keep abreast of what is happening. Until a merger is consummated and we know as to, for example, the divestiture and how extensive it is going to be here in Rhode Island, until we know that, there’s very little we can do. So that we can respond quickly when the time comes, so that we have thought about it, so there have been discussion in DBR on how it’s going to impact us – us meaning Rhode Island, us meaning DBR. Should the divestiture happen and there’s a state-chartered institution involved or a new institution involved, we ought to be prepared to respond quickly.
Did any of the Judiciary Committee’s questions surprise you, or that they were so consumer oriented?
No not really. I guess the surprise during the confirmation hearing was that to me it seemed like it took forever. It was only a couple of hours, but to me it seemed like it took forever. But the questions were very much consumer oriented. I think that probably stems from the fact that as DBR director another part of the job is to kind of look out to make sure that banks, in particular, are adhering to regulations designed to protect consumers.
A senator asked me did I think it was fair that if someone deposits a check and the person who gave them the check was a bum that the consumer had to pay for it? Well that’s real. I wouldn’t want to have to pay for it. Unfortunately as DBR director I have no say on it. That was my take on it: concerned senators asking questions about their constituents, consumers, to the person who in their mind should at least think about it and, to the extent I can, protect consumers.
Is there a section of DBR that deals with consumer complaints?
Yes in every department. I had a similar complaint to that about an out-of-state, national bank that in this consumer’s mind was charging an interest rate that was not fair. If you missed a payment they charged you a late fee for two or three days. On the surface I knew there was nothing we could do about that. So I sent it to the director of that department, who did some research and sent a letter to the consumer explaining to the best of our ability what she could do. That’s true of all the departments. We do not have a single ombudsman or whatever they call it, but in each department we do respond to all complaints.
Have you set goals for yourself and your department yet?
I set some 90-day working goals that I shared with the governor. Basically they are orientation kind of goals, but I haven’t set goals other than to do a good job which is very generic. At this early stage I can tell you, and I told the department, and if you print this I guess I’m telling Rhode Island: I see technology and the whole issue around it as being an important thing for us at DBR.
Do you want organizations to be able to file their regulatory reports electronically, because right now they all file paper reports?
In an ideal world that’s what I would like to have happen, to the extent that we could do it legally. Particularly routine documents, I would like to see them be available on a DBR web site.
DBR doesn’t have a web site now?
Not that’s interactive. That’s one of the things I would like to work towards.
Do you think that would make it easier for people who work here?
For everyone. I think it would make us more accessible. I think the best example I can use is I spoke to a trade group of 10 people, gave them my business card that has my e-mail. The next day I heard from seven of them by e-mail and I responded. Brooke (his assistant) didn’t have to type a single letter, nor did we spend whatever postage. They got personal contact with me. That’s technology for you, it’s simple.
Now that you’ve made the transition to government from private sector, how are you finding it?
Pleasant surprise. Pleasant surprise meaning I approached this position with some of the stereotypical views of public service, and that being real bureaucratic kinds of folks. I was with someone in one of the divisions today, not a manager, a worker. And I asked her, ‘How long does a complaint from a consumer take to get off your desk?’ Within two to three days on average. I thought that was pretty responsive, not the kind of thing people have been led to believe.
I was also pleasantly surprised to find that people who we regulate universally say unsolicited good things about DBR. I have heard things like, ‘they are tough but fair.’ What more can you ask for? That was a pleasant surprise.
A real surprise is everybody knows how much I make. Everybody in Rhode Island now knows how much you make. In the private sector no one except the top-most executives, whose salaries are revealed in proxy, has their salaries revealed. Those are some of the surprises.
No looking back of your shoulder at your consulting business then?
No in the sense that I approach this as I’m 58 years old and at a stage in my life and career where, gee whiz I would like to be remembered for something. As I said to one of my fellow directors: No matter how you slice it, there are only 50 people in the United States that are doing what I’m doing. So that’s rarefied air. It’s a real honor. If you don’t see it that way, gee whiz what kind of person are you? There are only 50 people doing it. There are more congressmen than that, there are more mayors, there are more senators than that.
This is a time in my life where I can do something that if I do my best, like the marathon, it’s a once in a lifetime chance to do something. (Schumpert ran the Boston Marathon four years ago.) No matter how you slice it, 100 years from now no one will remember Tom Schumpert; but if they’re researching the 99th marathon they’ll see number 8399, 10 hours, 43 minutes. Oh that was Tom Schumpert. Someone will research the DBR and they’ll see Tom Schumpert was there. So I’m leaving footprints and that’s important to me; that’s sentimental, but it is.
Another place where you may be making footprints is Governor Almond’s cabinet, I believe you are the only African American there and that’s a pretty exclusive club. Do you feel any added responsibility because of that?
I honestly believe I was picked first and foremost, because I’m good at what I do. I believe that of all the candidates, and there were a number that were equally as good, the governor finally chose me because I represented, as he said, extensive management expertise. I do feel that being African American might bring some additional visibility to me; I don’t have to work as hard to be seen. Beyond that, no. I’m not minimizing the role of being an African American in an exclusive club, but as senior credit officer of Sun Bank in Tampa Bay that would be even more rarefied air. Hopefully I might inspire some 30-something year old that if Tom Schumpert can do that, then I can do that much more.
I’m visiting with each of my fellow cabinet officers, and I’m asking them how do you be successful? What are the pluses and minuses? What I am sensing is that it’s no different than any other world, private or public, in the sense that when you’re dealing with professionals, skills come first. But then at a certain level skills are universal, everybody is good at what they do; then the next thing is how well do you relate with people? That is what I’m sensing from my peers so far. As I’ve met with the different directors who’ve already been here it’s, ‘welcome aboard.’ And I believe that’s genuine.
