Update on the CFPB from the Seller Finance Coalition

After Richard Cordray, the Consumer Financial Protection Bureau director since 2012, stepped down in Mid-November, President Trump announced the appointment of OMB director Mick Mulvaney (previous co-sponsor on the Seller Finance Enhancement Act) to become acting director of the agency on top of his duties with OMB. Subsequent to that President Trump’s announcement, then deputy director of the CFPB, Leandra English voiced her concern over the appointment.

A fight over who’s in charge of the agency played out at the agency headquarters in dueling e-mails battling for every employee’s loyalty. Mulvaney, physically in the director’s office on Tuesday, sent an email to CFPB employees instructing them to disregard any emails or directives from deputy director English. Also, English was on the hunt for advantage, making phone calls and meeting with external stakeholders.

English probed a federal judge in DC to proclaim that she is the new acting director and to ban President Trump from appointing anyone else to the director position. Obviously, the DOJ requested a temporary restraining order on English’s claim.

The legal fight involves two federal laws that seem to conflict. (1) The Federal Vacancies Reform Act gives the president authority to fill vacancies in top government posts. But (2) the statute that created the CFPB states that the deputy director “shall” become the acting director when there is a vacancy in the director’s spot.

On November 27th, a DC Federal District Judge, nominated by Trump, ruled that while the deputy director normally does slide into the director’s office when there is a vacancy, the president retains the option to choose another for the position.

While the Nov. 27th ruling is a victory for the Administration and opponents of the CFPB everywhere, the buck does not stop here. That same judge will schedule a hearing in the next few weeks on the actual legal issue and the case will probably be appealed to the Circuit Level.

But for now, Mulvaney is the acting director. Trump will eventually nominate a new CFPB director in the coming weeks or months, seeking to change the path of the bureau. But for now, the outspoken opponent of the CFPB, Mulvaney, will remain in power.

In terms of affecting HR 1360, the appointment is key to the Seller Finance Coalition and the Seller Finance Enhancement Act. We should/will focus on working with Mulvaney and his staff to gain support for HR 1360. Having strong support from a two-way agency head will increase the bill’s overall support.

Learn more go to www.SellerFinanceCoalition.org

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