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Dodd-Frank architects say Trump ignored law with CFPB appointment


The authors of the Dodd-Frank Act that created the Consumer Financial Protection Bureau (CFPB) said the Trump Administration has taken over an independent agency against the original wishes of Congress.

On a call with reporters on Thursday, former U.S. Sen. Christopher Dodd and former U.S. Rep. Barney Frank said Leandra English has good case to pursue her legal battle with the administration that she is the rightful acting director of the agency. The two former Democratic congressmen said they deliberately put succession language into the 2010 Dodd-Frank law that overrode the 1998 Federal Vacancies Reform Act – the law that President Donald Trump relied on this week to appoint his budget director, Mick Mulvaney, to the CFPB post.

presidenttrump“The irony of ironies is that we were thinking about exactly the situation that we find ourselves in today,” Dodd said. “Our great fear was that somebody would try to politicize the agency, which was the last thing we wanted to happen.”

Congress debated succession issues when the House and Senate were attempting to reconcile their two bills, but the Senate version, which included the current language, ultimately prevailed. Frank said Congress wanted to establish a proper succession procedure to ensure the agency’s continued independence, and so that the bureau could function until such time as a new director was appointed by the president and confirmed by the Senate. The CFPB has been taken over by the Trump administration and by Mulvaney, who works closely with the president and is a strong critic of the bureau.

“As long as he (Mulvaney) is the director, the agency will do almost nothing,” Frank said. “He is in charge of two things: The CFPB and running the government. So, the notion that he could do this on his lunch hour or his breakfast hour at Dunkin Donuts is ludicrous. So obviously he is put there to shut the agency down and keep it from being effective.”   

Michael Barr, one of the architects of the Dodd-Frank bill while with the Department of Treasury, also said during the call that a succession process was clearly spelled out by Dodd-Frank.

“It says specifically what is supposed to happen,” Barr said. “The deputy director shall serve as the acting director in the absence or unavailability of the director. It would be harder to find a clearer explanation of what Congress intended.”

Last Friday, Richard Cordray resigned as director, but elevated English, his former chief of staff, to the deputy director position. English sued in the U.S. District Court for the District of Columbia to block Mulvaney from assuming the acting director post on grounds that under Dodd-Frank the deputy director (English in this case) assumes the position of acting director in the absence of a director.

Judge Timothy Kelly, a recent Trump appointee to the court, denied English’s request for a temporary restraining order to block Mulvaney from taking over the bureau. Prior to that ruling, the CFPB’s general counsel, Mary McCleod, also told Politico that she believed Trump had the authority to appoint an acting director and instructed CFPB staff to treat Mulvaney as the acting director.

English’s supporters remain optimistic that she will ultimately prevail.

“The legal fight here is far from over,” said Brianne Gorod, the Constitutional Accountability Center’s chief counsel during Thursday’s call. 


 

Questions? Contact at (425) 984-6017 or victorw@scotsmanguide.com.

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  1. Posted: Dec 8, 2017  10:08 ET
    By: James Summers | LoanStar Home Lending
    1. 0


From the fascist party, the very two people in charge of Fannie Mae when the mortgage industry was running wild in the early 2000s I find it hard to take Dodd and Frank seriously today. More like they sabotaged the industry to create a heavy handed watch dog with a dictator like Cordray who is extremely anti business. Time for common sense rather than a bureau that is unconstitutional.


 

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