Categories: Legal

Supreme Court: President Has Authority To Fire CFPB Chief

The U.S. Supreme Court has struck down a key feature of the Consumer Financial Protection Bureau (CFPB) that limited presidential authority to fire the agency’s chief. The bureau was one of the major regulatory reforms that followed the epic economic collapse of the Great Recession.

The ruling, in the case of Selia Law v. Consumer Financial Protection Bureau, had Chief Justice John Roberts casting the deciding vote with the rest of the court’s conservatives. His written opinion said the restrictions on the president’s authority on an executive branch agency were unconstitutional.

The creation of the CFPB in 2010, by now-U.S. Sen. Elizabeth Warren (D-Mass.), was one of the big battles after the financial crisis. As with other reforms passed in the wake of the economic disaster, the financial industry has had the agency in its sights ever since.

The election of Donald Trump in 2016 gave the industry a chance to attack the agency.

Between its inception and President Trump’s inauguration, the CFPB returned nearly $12 billion to defrauded consumers, according to the Huffington Post. That’s because it was protecting consumers by enforcing rules for the likes of payday lenders, banks and others.

With Trump’s election, the fight over the agency was on.

In 2017, for example, the CFPB had drafted payday lending rules under the tenure of Richard Cordray, who had served as the previous director of the agency.

The Obama-era appointee sought to put in place new underwriting requirements for lenders, such as verifying borrowers’ ability to repay the payday loans. The rules also had another component, focused on how often a lender can try to debit payments from a customer’s bank account.

In 2019, a new Trump appointee as CFBP director sought to eliminate some of the rules — such as the requirement for lenders to verify a borrower’s income, debt and spending habits to assess their borrowing threshold before underwriting their loan.

Get our hottest stories delivered to your inbox.

Sign up for the PYMNTS.com Newsletter to get updates on top stories and viral hits.

——————————

New PYMNTS Study: Subscription Commerce Conversion Index – July 2020

Staying home 24/7 has consumers turning to subscription services for both entertainment and their day-to-day needs. While that’s a great opportunity for providers, it also presents a challenge — 27.4 million consumers are looking to cancel their subscriptions because of friction and cost concerns. In the latest Subscription Commerce Conversion Index, PYMNTS reveals the five key features that can help companies keep subscribers loyal despite today’s challenging economic times.

Recent Posts

Intuit Inks Deal To Purchase Order Management Provider TradeGecko

Intuit, maker of QuickBooks, has inked a deal to purchase inventory and order management technology provider TradeGecko. The deal is…

13 mins ago

Booking.com To Trim Employee Roster By 25 Pct Globally

Booking Holding Inc., the Connecticut-based company that owns travel website Booking.com, plans to reduce its workforce by as many as…

31 mins ago

Grab Launches Microinvestment Solution, Consumer Loans, BNPL Plans

Grab Financial Group (GFG), a Southeast Asia financial technology (FinTech) and ridesharing company, is expanding its reach with the announcement on…

42 mins ago

The State Of Main Street In 2020’s Second Half

The first half of 2020 was a tough time to run a small business on Main Street as stay-at-home orders…

1 hour ago

Today In Payments: Amex Grows BNPL Options; Facebook Unveils Commerce Accelerator Plans

In today’s top news, American Express has unveiled a new payment option, and Facebook has revealed plans for a Commerce…

2 hours ago

Sweden Is Next On Amazon’s Expansion List

As eCommerce surges around the world amid the coronavirus, Amazon is looking to further expand its presence in the European…

2 hours ago