ยป VISIT US ONLINE @ DSNEWS.COM
9
11 ATTORNEYS
GENERAL CHALLENGE
CFPB STRUCTURE
Eleven state attorneys general joined a
complaint challenging the structure of the
Consumer Financial Protection Bureau,
according to a brief filed with the United
States Supreme Court obtained by Reverse
Mortgage Daily. e brief argues that
the leadership structure of the CFPB is
unconstitutional, stating that its structure
infringes on the states' ability to enforce their
own consumer protection laws.
e coalition of states includes Texas,
Arkansas, Indiana, Kansas, Louisiana,
Nebraska, Ohio, Oklahoma, South Carolina,
Utah, and West Virginia.
"If Congress wishes to permit federal
agencies to assist or preempt States in
protecting consumers, it must do so in a
manner consistent with Article II of the
Constitution," the brief reads in part. "e
CFPB's structure violates the Constitution
whether its director was (at any given point)
temporary or permanent. e CFPB thus
had no authority to bring or to continue the
enforcement action."
e CFPB was similarly challenged earlier
this year by a California law firm that argues
the Consumer Financial Protection Bureau
is unconstitutionally structured. e U.S.
Supreme Court agreed to hear the appeal of
the law firm, Seila Law, who alleges that the
structure of the agency grants too much power
to its director.
e Supreme Court is expected to hear the
Seila Law LLC v. Consumer Protection Bureau
suit sometime in 2020, and CNBC reports
that a decision in the case is likely by the end
of June.
Last year, in a split decision, a Washington
appeals court reversed a previous ruling,
declaring the structure of the Consumer
Financial Protection Bureau to be
constitutional after all. e Court of Appeals
for the District of Columbia Circuit ruled
in January 2018 that the CFPB's structure is
constitutional and that the president can only
fire the director of the agency for "inefficiency,
neglect of duty, or malfeasance in office."
e court's ruling read, in part, "None
of the theories advanced by PHH supports
its claim that the CFPB is different in kind
from the other independent agencies and, in
particular, traditional independent financial
regulators."
