President Donald Trump on Saturday expressed his sympathies for financial institutions a day after naming his budget director acting director of the Consumer Financial Protection Bureau.
Trump said the agency, authorized by the 2010 Dodd-Frank Act as a watchdog for consumers in their interactions with large financial institutions, had “devastated” those institutions and made them “unable to properly serve the public.”
“We will bring it back to life!” he said, presumably referring to himself and Mick Mulvaney, the White House budget director who Trump said Friday would take over as the CFPB’s acting director. Mulvaney in 2014 said agency was a “sick, sad joke.”
The Consumer Financial Protection Bureau, or CFPB, has been a total disaster as run by the previous Administrations pick. Financial Institutions have been devastated and unable to properly serve the public. We will bring it back to life!
— Donald J. Trump (@realDonaldTrump) November 25, 2017
Check out the recent Editorial in the Wall Street Journal @WSJ about what a complete disaster the @CFPB has been under its leader from previous Administration, who just quit!
— Donald J. Trump (@realDonaldTrump) November 25, 2017
But Mulvaney’s ascension, even temporarily, to the head of the consumer agency is contested: After former CFPB Director Richard Cordray announced his resignation Friday, he elevated his chief of staff, Leandra English, to be the agency’s deputy director. Cordray argued that, according to Dodd-Frank, English would become acting director — rather than Mulvaney — upon his resignation, which was effective at midnight.
Though the Washington Post reported Saturday that though the White House had not yet been in touch with the agency, both sides have staked their legal claims.
“We think the clear legal authority is that the president does have this authority. We’ll find out based on how Ms. English decides to act at the appropriate time,” one unnamed official told the Post.
Unnamed senior administration officials said the Justice Department’s Office of Legal Counsel supports the White House’s position that the Federal Vacancies Reform Act gives Trump the power to install Mulvaney until a permanent director is approved by the Senate, a process that could take months and leave Mulvaney plenty of time to enact a deregulatory agenda.
Cordray himself told the Post: “The law authorized me to appoint a deputy director, and I did so. My understanding of the law is that the deputy director serves as the acting director upon my resignation.”
“If there are disagreements about these issues, the appropriate place to settle them would be in the courts,” he added.
Dodd-Frank’s co-author, former Rep. Barney Frank (D-MA) told the Post “it’s obvious” that the Cordray’s interpretation was correct.
“If you look at the CFPB language it is very specific and it was designed to protect an agency that we knew would be under a lot of pressure,” he told the Post. “This is an agency that enforces the rules against some of the most powerful financial interests in the country. Everything was structured for its independence.”
