The incoming Trump administration and Republicans in Congress have set their eyes on the Consumer Financial Protection Bureau. The topic under fire is the agency’s power structure.
The CFPB recently asked the Federal Appeals court in Washington to reopen and review the case against its leadership dynamic and the fact that it has been deemed unconstitutional.
Last October, the US Appeals Court struck down the CFPB stating that the agency had created a leadership position that held enormous and unequivocal power. This control had no set checks and balances and led the three-judge panel to rule it unconstitutional.
Judge Cavanaugh wrote the court’s opinion in which they stated the solution would be to allow the President discretion to remove the head of the CFPB for any reason, not just “for cause.”
Richard Cordray, the director of the agency that was created out of the Dodd-Frank reform law, argues his belief that the court’s ruling undermines Congressional decisions and will set a precedent that will be far reaching and that will have devastating results.
The court went on to state that they believe that the head of the CFPB had more unilateral authority than any of the three branches of government.
Cordray is concerned the incoming administration will remove him from the head of the agency as they seek to deregulate the financial industry and dismantle Dodd-Frank.
The only certainty to date is that although the president-elect has given his opinion and ideas, no plan is currently being looked at to validate the CFPB’s concerns.