November 26, 2017; CNN
The deputy director of the Consumer Finance Protection Bureau (CFPB) has filed an eight-page complaint in federal court seeking to prevent President Trump from naming OMB Director Mick Mulvaney acting director of the independent finance watchdog agency.
Leandra English, CFPB Director Richard Cordray’s chief of staff until her appointment as deputy director last Friday, is seeking a temporary restraining order preventing Trump from installing Mulvaney and, in effect, validating her status as acting director until the US Senate confirms her replacement. Cordray appointed English to the number-two position to allow her to serve as acting director as defined in the Dodd-Frank law which established the bureau.
Cordray was expected to resign his position sometime this winter in order to run for the Democratic nomination to be governor of Ohio. He had previously announced that he would resign sometime in November, but the timing of his resignation and the appointment of English the day after Thanksgiving was a double-barreled surprise.
The White House Counsel’s office, the US Department of Justice, and the general counsel of the CFPB itself agree that Dodd-Frank does not control succession at the CFPB. Instead, they argue, the 1998 Federal Vacancies Reform Act, passed in 1999, vests that power in the presidency. English argues in her filing that the Dodd-Frank process, passed in 2010, supersedes the Vacancies Act. Casting further question over the legal issues is a 2016 federal court ruling declaring the leadership structure of the CFPB unconstitutional.
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Sen. Elizabeth Warren (D-MA), an architect and fierce proponent of the agency who was once considered for appointment as its first director, tweeted: “@realDonaldTrump can nominate the next @CFPB Director—but until that nominee is confirmed by the Senate, Leandra English is the Acting Director under the Dodd-Frank Act.”
However, banking and finance industry advocates share the view of Rick Manning, president of Americans for Limited Government: “President Trump is the only person allowed to name the new head of the Consumer Financial Protection Bureau. Any attempt to circumvent that authority by Cordray runs counter to the fundamental principles of American governance.”
Republicans hope that there won’t be a showdown at the CFPB offices on Monday morning with Mulvaney and English both attempting to move into the director’s office and issuing orders to staff. That would be too reminiscent of competing Cabinet appointments and the Tenure of Office Act that led to the impeachment (and ultimate acquittal) of Andrew Johnson in 1868.
However, this federal power showdown builds pressure for the administration to quickly nominate a new CFPB director. Since Senate Democrats voted to remove the 60-vote requirement for most federal appointments in 2013, a new director could be confirmed on a party-line vote by the Senate’s GOP majority if necessary. Regardless of who is named, the appointment would be controversial because many Republicans agree with the federal court decision finding that “other than the President, the Director of the CFPB is the single most powerful official in the entire United States Government, at least when measured in terms of unilateral power.” Trump’s appointee would be expected to back increased Congressional oversight, including Congressional appropriation of the agency’s budget (funding for the CFPB currently comes from the Federal Reserve).
The longer it takes for the federal court (or courts, in the likely case of appeals) to decide who is the acting CFPB director, and the longer it takes for Trump to nominate Cordray’s successor and have that person confirmed by the Senate, the longer the CFPB will be yet another political football.—Michael Wyland