More Thoughts on the CFPB Puzzle: President Trump Can Select Someone to Run the CFPB Only if the Senate Has an Opportunity to Confirm

by Nina Mendelson | November 28, 2017

Originally posted at Notice & Comment, a blog of the Yale Journal on Regulation and the American Bar Association Section of Administrative Law & Regulatory Practice. Reprinted with permission.

On Friday, November 24, Consumer Financial Protection Bureau Director Richard Cordray named Leandra English, the longtime CFPB Chief of Staff, to the post of Deputy Director. Based on legislation specific to the CFPB, that put her in a position to serve as Acting Director upon his departure. Cordray then resigned. A few hours after Cordray resigned, the White House announced that President Trump had selected OMB Director Mick Mulvaney to serve as CFPB Acting Director, invoking the President’s powers under the more general Federal Vacancies Reform Act. Unfortunately, President Trump’s actions may result in needless—and illegal—chaos at the CFPB. The President surely retains the power to choose the next CFPB Director, but only by nominating a candidate that the Senate confirms.

Under the 2010 Dodd-Frank legislation, which authorized the creation of the CFPB, the Deputy Director is to serve as Acting Director in the absence of a director. Dodd-Frank’s statutory language is specific and mandatory. The Deputy Director—presently Leandra English—“shall serve as acting Director in the absence or unavailability of the Director.” 12 USC 5491(b)(5). But the Office of Legal Counsel has suggested that a more general statute, the Federal Vacancies Reform Act of 1998, also applies. That statute authorizes the “first assistant” to the office to act (also Deputy ...

With Final Forced Arbitration Rule, the CFPB Continues to Advance the Public Interest

by Thomas McGarity | July 13, 2017
Earlier this week, the Consumer Financial Protection Bureau (CFPB) took decisive action to protect hardworking people who are cheated by banks or other financial institutions. Specifically, the federal agency issued a rule limiting what are known as "forced arbitration" agreements in the contracts we must all sign when we open a bank account or purchase certain kinds of financial products and services. Last year, scholars and staff at the Center for Progressive Reform authored a report that supported CFPB's efforts ...

It's Time to Give Customers of Financial Services and Products Their Day in Court

by James Goodwin | October 10, 2016
Originally published by the Oxford Business Law Blog. Reprinted with permission. Forced arbitration clauses are now almost impossible to avoid in consumer contracts for financial services and products ranging from credit cards to private student loans. Despite their ubiquity, most consumers aren't even aware of them. This is because companies frequently bury them deep in the lengthy fine print of their contracts, which they then offer to consumers on a 'take it or leave it' basis. Forced arbitration clauses warrant ...

Comments from CPR: Forced Arbitration Proposal Is Strong but Should Be Stronger

by James Goodwin | August 23, 2016
Yesterday, several CPR Member Scholars and staff formally submitted comments on the Consumer Financial Protection Bureau's (CFPB) proposed rule to limit the use of forced arbitration agreements in consumer contracts for financial products like credit cards and bank accounts.  CPR Member Scholars and staff have been tracking this rulemaking for over a year and in May 2016 published a report that assessed several key issues shortly before the CFPB released its proposal. In particular, our report evaluated the CFPB's preliminary ...

New Paper: Americans Hurt By Forced Arbitration Agreements with Big Banks, Credit Card Companies

by Brian Gumm | May 04, 2016
NEWS RELEASE: New Paper Shows Americans Hurt By Forced Arbitration Agreements with Big Banks, Credit Card Companies Forthcoming Rule from Consumer Financial Protection Bureau Offers Some Solutions, but More Can Be Done to Protect Consumers Opening a checking account or using a credit card is an essential, everyday activity for many Americans, but most financial services are governed by pages of fine print, much of which is difficult to navigate and understand. As a new paper from the Center for ...

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