Personnel

CFPB Director Dispute Is Going To Court

The Consumer Financial Protection Bureau’s departing president, Richard Cordray, created uncertainty surrounding the leadership of the government watchdog after naming a temporary director. And now, it seems, the whole issue will certainly be decided by the courts.

According to The Wall Street Journal, Cordray appointed the agency’s chief of staff, Leandra English, as deputy director on Friday (Nov. 25), which was his last day as the head of the CFPB. Cordray said English “shall” serve as the agency’s acting chief if the director is unavailable or absent.

“In considering how to ensure an orderly succession for this independent agency … I have also come to recognize that appointing the current chief of staff to the deputy director position would minimize operational disruption and provide for a smooth transition given her operational expertise,” Cordray said in a statement. That roiled Republicans, who aren’t fans of the agency and vowed to overhaul it under President Donald Trump.

Within a few hours, President Trump appointed Mick Mulvaney – the director of the White House Office of Management and Budget (OMB) – as the acting CFPB director. The White House said he will remain in the role until a replacement is nominated and confirmed. Mulvaney has long been a critic of the CFPB, and has stood by a comment in which he called the agency a “sad, sick joke.”

“Americans deserve a CFPB that seeks to protect them, while ensuring free and fair markets for all consumers,” Mulvaney said in a statement to The Wall Street Journal.

The move by President Trump is likely to set the stage for a legal battle with Democrats, who are already saying the president has the authority to nominate the next director but can’t name the interim one. Democrats point to a law under Dodd-Frank that states the deputy director is to take over in the interim at the CFPB. White House officials argue that President Trump has the authority to name a short-term replacement under the 1998 Federal Vacancies Reform Act.

Over the weekend, the Justice Department said that the White House was in the right to name the new interim director. Alan Kaplinsky, head of the Consumer Financial Services Group for the law firm Ballard Spahr LLP, told Reuters the issue will likely end up in the courts.

And, it seems has of last night – that likely to end up in courts has flipped to certain to end up in court.

Leandra English,  Cordray’s official choice for the job as of last week – has officially sued the Trump administration as of last night to block budget director Mick Mulvaney from taking control of the agency.

English filed the lawsuit in federal court the night before the bureau was set to reopen with dueling temporary leaders vying to take it over.

That means, as of today –  two officials have a claim on the acting top job. Mr. Mulvaney, who also serves as head of the Office of Management and Budget, and Ms. English.

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