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WASHINGTON—The White House’s budget chief, Mick Mulvaney, arrived at the Consumer Financial Protection Bureau on Monday to assume the job of acting director after an agency official sued to block the Trump administration from taking control of the regulator.

Mr. Mulvaney, carrying a bag from Dunkin’ Donuts, entered the building early Monday with aides at his side. Officials at the White House’s Office of Management and Budget, which Mr. Mulvaney leads, later tweeted an image showing him sitting at a desk reading briefing books on the consumer regulator.

It wasn’t clear whether Leandra English, a career staffer appointed Friday to lead the CFPB by former director Richard Cordray, was also working in the building. She filed a lawsuit in federal court Sunday night in an attempt to stop the Trump administration from running the bureau while the White House finds a permanent nominee to head the CFPB. Mr. Cordray, the former director appointed by President Barack Obama, stepped down on Friday.

Drama over the immediate future of the CFPB is still playing out. Mr. Mulvaney hasn’t taken any actions yet to alter the course of the bureau, but he is expected to do so soon unless legal developments freeze his involvement in the agency. Ms. English is seeking a temporary restraining order in federal court, in a process that could play out quickly and raises questions on how different statutes regarding succession apply to the CFPB.

President Donald Trump asserts he has the power to appoint an acting director, while the departing chief believed the law said otherwise. That means that both Mr. Mulvaney and Ms. English have claimed the acting top job.

The unfolding drama is the latest twist for the CFPB, which has been mired in partisan battles since the agency was created in the wake of the financial crisis.

The agency was created in response to criticism that the previous regulatory structure didn’t prevent a mortgage-market meltdown because the responsibility for consumer protection was scattered among various agencies. To allow the CFPB to work quickly, lawmakers designed the bureau to be independent, stating that its single director could only be dismissed by the president for “inefficiency, neglect of duty or malfeasance in office” and insulating its budget from congressional oversight.

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CFPB moves drew praise from consumer advocates and Democrats. But Republican lawmakers and the financial industry have long said the agency’s rules and supervisory and enforcement activities have increased compliance costs and reduced credit availability for vulnerable consumers the bureau was created to protect. The pushback has been particularly strong from industries that had previously been regulated lightly, such as payday and auto lending.

Republicans have proposed curbs to the CFPB’s power, including turning it into a commission, giving Congress control of its budget and narrowing the scope of its regulatory powers that would leave it primarily an enforcement agency.

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She filed a lawsuit in federal court Sunday night in an attempt to stop the Trump administration from running the bureau while the White House finds a permanent nominee to head the CFPB.

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Originally posted by feersum dreadnaught:
But English argues that the Dodd-Frank Act, a law championed by Democrats that created the Consumer Financial Protection Bureau, prohibits the White House from naming the director for the agency.

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On July 17, 2011, President Barack Obama announced he would nominate Cordray to lead the United States Consumer Financial Protection Bureau. On January 4, 2012, the White House announced that it would make a recess appointment of Cordray to the post.

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Originally posted by sjtill:
The Consumer Financial Protection Bureau is Liz Warren's baby. It was created as an independent agency, not accountable to the Executive.

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Originally posted by feersum dreadnaught:
That official, Leandra English, was named acting director by the outgoing Obama-appointed head of the bureau. She is currently suing the White House over Trump's decision to instead install his budget office boss, Mick Mulvaney, to the post.

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The left clings to power at the CFPB
The Consumer Financial Protection Bureau (CFPB) is the federal agency that’s supposed to protect consumers in the financial sector. It was created by the Dodd-Frank Act.

The CFPB’s director heads the agency free from presidential supervision. Given the CFPB’s broad authority over the U.S. economy, the director “enjoys significantly more unilateral power than any single member of any other independent agency.” So said the U.S. Court of Appeals for the District of Columbia in declaring the leadership structure of the CFPB unconstitutional.

This decision is under review by the full D.C. Circuit, a body dominated by liberal Democrats. The matter is may be headed to the Supreme Court.

In the meantime, we are in the midst of a struggle over who will be the CFPB director. Richard Cordray, a left-wing Ohio politician, has been the director. He was appointed when it became clear that Elizabeth Warren, whose brainchild the CFPB is, could not be confirmed to lead it.

On Friday, Cordray announced his resignation effective immediately, and appointed Leandra English, his chief of staff, to be the deputy director of the CFPB. He did so in order to prevent President Trump from reining in the agency.

Shannen Coffin explains the move:

Trump has express constitutional authority to appoint Cordray’s replacement and, in time, will do so. But like much that happens in Washington, installing a new director of the CFPB will take time. The appointment is subject to the advice and consent of the Senate, and Senate Democrats will throw as much sand in the gears of the confirmation process as a minority party can muster. The directorship could remain vacant for months, or longer.

By slow-walking the confirmation process and, at the same time, blocking the president’s appointment of an interim director, Democrats could for, the foreseeable future, extend Cordray’s regulatory mischief and forestall efforts to roll back the CFPB’s regulatory programs.

Mick Mulvaney, who currently heads the Office of Management and Budget, is Trump’s choice to direct the the CFPB. Mulvaney has called the CFPB a “sick, sad joke,” and a “wonderful example of how a bureaucracy will function if it has no accountability to anyone.” As acting director, Mulvaney could begin the process of unwinding the CFPB’s regulatory overreach.

Recently, that overreach has been particularly pronounced. According to Coffin:

In the months leading up to his resignation, Cordray accelerated the CFPB’s work and its regulatory overreach. He rolled out new regulations prohibiting mandatory arbitration in financial services agreements—they were subsequently overturned by Congress under the Congressional Review Act. Cordray finalized a far-reaching rule—the breadth of which is evidenced by more than 1,700 pages of official commentary—that seeks to police out of existence much of the payday and title-loan industry without providing alternative credit avenues to the millions of cash-strapped consumers who use these lenders of last resort.

The CFPB also stepped up its enforcement efforts against financial-services businesses aimed at the individual consumer, invoking a muscular and seemingly boundless statutory view of its authority to curb “unfair, deceptive and abusive” practices. This trend would likely continue under Cordray’s hand-picked successor.

President Trump responded to Cordray’s power play, or resistance as Sen. Tom Cotton describes it, by designating Mulvaney as acting director of the CFPB. Trump invoked his power under the Vacancies Reform Act of 1988. It permits the president to designate any Senate-confirmed federal official (and certain other federal officers and employees) to perform the functions and duties of a vacant federal office (with some limited exceptions) in an acting capacity for a statutorily-limited time period.

The General Counsel of the CFPB issued a memorandum concurring in the President’s action. However, English filed a lawsuit to force Mulvaney out and keep control over the agency.

The basis of English’s suit is that the Dodd-Frank Act provides that the director has the authority to appoint a deputy director who “shall . . . serve as acting Director in the absence or unavailability of the Director.” English argues that this provision controls because the Vacancies Reform Act provides that its methods of temporarily filling a vacant office are meant to be exclusive, unless some other statutory provision explicitly permits another mode of designation or “designates an officer or employee to perform the functions and duties of a specified office temporarily in an acting capacity.” She contends that the Dodd-Frank Act is such a separate statute, and it designates the deputy director to perform the functions and duties of the vacant director position in an acting capacity to the exclusion of the president’s authority.

Coffin rejects English’s argument. He points out that the Vacancies Reform Act does not say the president’s authority is overridden where a separate statute, such as Dodd-Frank, provides for other modes of designating an acting official. It merely says that the president’s power is not exclusive in those circumstances — in other words, the president can decide to appoint someone or to allow go along with the designee selected pursuant to another statute.

That’s been the position of the Justice Department’s Office of Legal Counsel. In addition, the liberal Ninth Circuit Court of Appeals, in a case involving the National Labor Relations Board Office of General Counsel, concluded that the president may elect which avenue to choose where another statute also authorizes a method of temporarily filling a vacancy.

In addition, Coffin argues that the Dodd-Frank Act doesn’t really address vacancies in the office of CFPB director at all. It speaks of situations in which the director is absent or unavailable, not cases in which there is no director.

By contrast, the OMB statute applies “when the office of Director is vacant.” Other statutes similarly speak of vacancies in office. Thus, Congress knows how to authorize an official to act in the event of a vacancy. It did not do so in Dodd-Frank.

In any event, courts now have two issues to sort out: (1) is the structure of the CFPB constitutional and (2) who is the agency’s acting director.

What should happen in the meantime? I call on Sen. Tom Cotton: The Consumer Financial Protection Bureau is a rogue, unconstitutional agency. Leandra English’s lawsuit to install herself as acting director against the president’s explicit direction is just the latest lawless action by the CFPB. She doesn’t have a legal leg to stand on, as her own general counsel has conceded and the Department of Justice has concluded. The president should fire her immediately and anyone who disobeys Director Mulvaney’s orders should also be fired summarily. The Constitution and the law must prevail against the supposed resistance.