The Supreme Court’s ruling there was a constitutional defect in the Consumer Financial Protection Bureau’s (CFPB) structure, but that the problem could be fixed without disbanding the agency, was a win for consumers.
In a 5-4 decision, the court ruled the CFPB director must be removable by the president at will going forward, and that the agency should
continue its work. Some of the CFPB’s critics argued the bureau was unconstitutional because it didn’t allow presidents to remove the agency’s director at will. The court agreed that they were right, but opted for a carving knife instead of a sledgehammer.
Consumers should be thankful they did. The bureau was created as a direct result of bad actors whose practices contributed to the Great Recession and millions of Americans losing their homes. Some still have not recovered.
The bureau’s detractors were as concerned with what many perceived as the heavy-handed tactics of former CFPB director Richard Cordray
(and others who might follow in his footsteps) as they were with the structure of the agency.
Going forward, whether Congress decides the bureau should be overseen by a bipartisan committee, as some in the industry are advocating, or a single director is a political decision. Whatever they decide, the vital regulation and oversight provided by the CFPB must continue.
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Editor of The Title Report