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| | [[Mick Mulvaney]] was appointed by President [[Donald Trump]] to clean up the agency.<ref>https://thehill.com/homenews/senate/382842-mulvaney-in-senate-testimony-im-required-to-be-here-but-not-to-answer-your?amp</ref><!--He assumed the role after a power struggle with Deputy Director Leandra English.--> | | [[Mick Mulvaney]] was appointed by President [[Donald Trump]] to clean up the agency.<ref>https://thehill.com/homenews/senate/382842-mulvaney-in-senate-testimony-im-required-to-be-here-but-not-to-answer-your?amp</ref><!--He assumed the role after a power struggle with Deputy Director Leandra English.--> |
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| | + | ==Background== |
| | + | As explained by the [[Fifth Circuit]]: |
| | + | <blockquote>In response to the 2008 financial crisis, Congress enacted the Consumer Financial Protection Act, 12 U.S.C. §§ 5481-5603. The Act created the Bureau as an independent regulatory agency housed within the Federal Reserve System. See id. § 5491(a). The Bureau is charged with "implement[ing]" and "enforce[ing]" consumer protection laws to "ensur[e] that all consumers have access to markets for consumer financial products and services" that "are fair, transparent, and competitive." Id. § 5511(a). |
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| | + | Congress transferred to the Bureau administrative and enforcement authority over 18 federal statutes which prior to the Act were overseen by seven different agencies. See id. §§ 5512(a), 5481(12), (14). Those statutes "cover everything from credit cards and car payments to mortgages and student loans." Seila Law LLC v. CFPB, 140 S. Ct. 2183, 2200, 207 L. Ed. 2d 494 (2020). In addition, Congress enacted a sweeping new proscription on "any unfair, deceptive, or abusive act or practice" by certain participants in the consumer-finance industry. 12 U.S.C. § 5536(a)(1)(B). "Congress authorized the [Bureau] to implement that broad standard (and the 18 pre-existing statutes placed under the agency's purview) through binding regulations." Seila Law, 140 S. Ct. at 2193 (citing 12 U.S.C. §§ 5531(a)-(b), 5581(a)(1)(A), (b)). |
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| | + | Congress placed the Bureau's leadership under a single Director to be appointed by the President with the advice and consent of the Senate. 12 U.S.C. § 5491(b)(1)-(2). The Director serves a term of five years, with the potential of a holdover period pending confirmation of a successor. Id. § 5491(c)(1)-(2). The Act originally limited the President's ability to remove the Director, id. § 5491(c)(3), but the Supreme Court invalidated that provision while this litigation was pending, see Seila Law, 140 S. Ct. at 2197. |
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| | + | The Director is vested with authority to "prescribe rules and issue orders and guidance, as may be necessary or appropriate to enable the Bureau to administer and carry out the purposes and objectives of the Federal consumer financial laws, and to prevent evasions thereof." 12 U.S.C. § 5512(b)(1). This includes rules "identifying as unlawful unfair, deceptive, or abusive acts or practices" committed by certain participants in the consumer-finance industry. Id. § 5531(b). |
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| | + | The Bureau's funding scheme is unique across the myriad independent executive agencies across the federal government. It is not funded with periodic congressional appropriations. "Instead, the [Bureau] receives funding directly from the Federal Reserve, which is itself funded outside the appropriations process through bank assessments." Seila Law, 140 S. Ct. at 2194. Each year, the Bureau simply requests an amount "determined by the Director to be reasonably necessary to carry out the" agency's functions. Id. § 5497(a)(1). The Federal Reserve must then transfer that amount so long as it does not exceed 12% of the Federal Reserve's "total operating expenses." Id. § 5497(a)(1)-(2). For the first five years of its existence (i.e., 2010-2014), the Bureau was permitted to exceed the 12% cap by $ 200 million annually so long as it reported the anticipated excess to the President and congressional appropriations committees. Id. § 5497(e)(1)-(2).</blockquote> |
| | + | ''Cmty. Fin. Servs. Ass'n of Am. v. Consumer Fin. Prot. Bureau'', 51 F.4th 616, 623-24 (5th Cir. 2022). |
| | ==Services== | | ==Services== |
| | The ''[[Wall Street Journal]]'' reported, "The pride of Harvard Law School, Ms. Warren is a hero to the political Left for proposing a new bureaucracy to micromanage the services that banks can offer consumers. But she is also so politically controversial that no less a liberal lion than Connecticut Senator [[Chris Dodd]] has warned the White House that she probably isn't confirmable."<ref name=wsj>[http://online.wsj.com/article_email/SB10001424052748703440604575495681843430198-lMyQjAxMTAwMDEwODExNDgyWj.html Elizabeth III - Obama to Senate: Stick that in your advice and consent clause.]</ref> | | The ''[[Wall Street Journal]]'' reported, "The pride of Harvard Law School, Ms. Warren is a hero to the political Left for proposing a new bureaucracy to micromanage the services that banks can offer consumers. But she is also so politically controversial that no less a liberal lion than Connecticut Senator [[Chris Dodd]] has warned the White House that she probably isn't confirmable."<ref name=wsj>[http://online.wsj.com/article_email/SB10001424052748703440604575495681843430198-lMyQjAxMTAwMDEwODExNDgyWj.html Elizabeth III - Obama to Senate: Stick that in your advice and consent clause.]</ref> |