What Happens To The CFPB Now? No More Protecting Consumers From Wall Street Avarice?

On Friday, Trump appointed right-wing crackpot and OMB Director Mick Mulvaney acting director of the Consumer Finance Protection Bureau. But there already was an acting director. Richard Cordray, on announcing that he was stepping down at the end of the day, also announced that his chief of staff, Leandra English, is the new deputy director and acting head of the agency. The Dodd-Frank Act, which created the CFPB, specifies that the deputy director will be head of the bureau between permanent directors-- and permanent directors have to be confirmed by the Senate.

The CFPB was Elizabeth Warren's idea and she recounted to her supporters on Saturday that "In 2014, then-Tea Party Congressman Mick Mulvaney called the new Consumer Financial Protection Bureau a 'sick, sad joke.' When asked what changes he’d like to make to the CFPB, Mulvaney replied: 'Well some of us would like to get rid of it.' And in 2015, he cosponsored a bill that would do just that." In response to Trump appointing Mulvaney acting director-- when there already is one-- she pointed out that "Trump does NOT have the power to do this. The Dodd-Frank Act is clear: if there is a CFPB Director vacancy, the Deputy Director becomes Acting Director. Trump can nominate the next CFPB Director-- but until that nominee is confirmed by the Senate, Deputy Director Leandra English is the Acting Director under the Dodd-Frank Act. We knew that Donald Trump was likely going to use Rich Cordray’s departure as his chance to dismantle the CFPB. Earlier this year, he promised corporate CEOs that he would deliver 'a major elimination of the horrendous Dodd-Frank regulations.' And now, he could do it... We fought Donald Trump when he named an Education Secretary who doesn’t believe in public education. We fought him when he named an EPA director who doesn’t believe in climate change. We fought him (and won) when he named a Labor Secretary who doesn’t believe in unions. And we will fight him now to stop an Acting CFPB director who doesn’t believe in protecting working families from the big Wall Street banks."

Yesterday, the White House responded by claiming Trump has the authority to do whatever he wants. Still, as Politico reported. "the two moves plunged the agency into confusion over the leadership of the bureau, which was established in the wake of the financial crisis and has become a lightning rod for attacks by Republicans and business executives for its aggressive enforcement."


The 2010 Dodd-Frank Act, which created the CFPB, explicitly says the consumer bureau's deputy director shall “serve as acting Director in the absence or unavailability of the Director,” giving the edge to English.

Yet the Federal Vacancies Act allows the president to install a temporary acting head of any executive agency who has already been confirmed by the Senate to another position, like Mulvaney has as leader of the Office of Management and Budget.

Still, the Vacancies Act says that an opening may also be filled if another law "expressly … designates an officer or employee to perform the functions and duties of a specified office temporarily in an acting capacity.”

It doesn't say whether one approach supersedes the other, something the courts will likely have to sort out.

Today's actions were the latest drama engulfing an agency that Republicans have targeted since its inception. GOP lawmakers and bankers say the consumer bureau regulates through enforcement rather than rulemaking and that its single director has unconstitutional power.

Banksters and their lobbyists are going berserk at the idea of Trump being stymied in his goal of destroying the agency by installing Mulvaney. Chris Stinebert, head of the American Financial Services Association, probably the most venal defender of aggressive Wall Street corruption: "Today’s actions by former CFPB Director Richard Cordray in appointing his own Acting Director to lead the bureau reinforces the problematic nature of having a single and completely unaccountable leader. The decision to choose who should lead the country’s consumer protection agency, and confusion that’s been caused by Cordray’s own 'succession plan,' should not be made by one individual and for this reason AFSA has long advocated the need for a bipartisan commission."

Mensonge du jour

Former Treasury Department economist and Iowa congressional candidate Austin Frerick reminded us about regulatory capture-- a Trump Regime specialty-- this morning. "This is how an agency gets captured: Industry attempts to get one of its stooges appointed to one of its largest regulators. We have to fight this action and insist on the rule of law Senator Warren pointed out, but we can’t keep playing defense. Industries are able to capture industries because of their monopolistic power (cough cough FCC). Antitrust enforcement is about restoring competition to our markets and removing corruption from our political system."

Jared Golden is running for the Maine seat occupied by multimillionaires and House Financial Services Committee crook Bruce Poliquin. Jared, the majority whip of Maine's state House, was very straight forward about how this works: "What’s going to happen now is they are going to dismantle and hamstring the CFPB and there won’t be anyone left to watch consumers backs. The big banks and giant corporations are going to run roughshod over normal people who don’t stand a chance without tough consumer protections in place to keep things fair." That, in short, is why it's so important to help elect candidates like Austin Frerick and Jared Golden.

Katie Porter, the candidate running for the inland Orange County congressional seat held by Republican carpetbagger Mimi Walters, is one of California's most respected and knowledgable experts on consumer protection. "With Donald Trump and his billionaire cronies in office, the very existence of the Consumer Financial Protection Bureau is at risk," she told us. "As a consumer advocate who has spent nearly twenty years fighting to help families who were cheated, I can tell you for a fact that the big banks are not going to put consumers ahead of profit. We need a system of fair and reasonable protections to make the marketplace work for all of us. We need a watchdog with a proven record of protecting consumers to lead the CFPB, not Mick Mulvaney."