| Dear GARY,
Today, the Supreme Court of the United States issued its decision in Seila Law LLC v. Consumer Financial Protection Bureau. In a 5-4 decision, the Court struck down as unconstitutional a provision in the Dodd-Frank Wall Street Reform and Consumer Protection Act that restricts the President’s ability to remove the Director of the Consumer Financial Protection Bureau (CFPB) except for cause.
NCLC, as Counsel of Record, joined by our allies in the consumer law community, filed an amicus brief arguing that if the Supreme Court found the for-cause provision unconstitutional, it should sever that provision and preserve the remainder of the Dodd-Frank law establishing the CFPB. Thankfully, three members of the Court majority, along with the four dissenting justices, held that the for-cause provision could indeed be severed, as NCLC urged.
The Seila decision therefore leaves the CFPB intact but weakens the Director’s independence, making it more likely that the Director will hesitate to cross the financial industry players that have the ear of the President — as has happened repeatedly under the current leadership of the CFPB. “We have seen in this Administration how agency heads who dare to express independent views have been short-lived, and it is unfortunate that the consumer watchdog has lost the critical independence that Congress gave it when addressing the fallout from the 2008 financial crisis,” says Lauren Saunders, NCLC Associate Director. “Nonetheless, the CFPB survives as an agency with the rest of its critical consumer protection tools intact, and it will be up to the current and future CFPB directors to resist political pressure to favor corporations over consumers.”
NCLC Director of Litigation Stuart T. Rossman says that, “Severing the ‘for cause’ provision and allowing the CFPB to otherwise continue intact is the appropriate remedy. Undoing Congress’s sweeping restructuring of financial regulation by eliminating the CFPB instead of severing the for-cause removal provision would have contravened Congress’s intent to establish a sole federal regulator charged with stabilizing the marketplace and protecting consumers.”
In our increasingly complex financial world, vigilant government oversight is essential to protect consumers in the financial marketplace. Please visit NCLC’s website for regular updates on our work on regulatory reform and CFPB issues. We will continue to advocate for a strong and independent CFPB that puts the interests of consumers first, and we are grateful for your own work and your support in the struggle for economic justice for all.
Sincerely, |
