Federal Government Policy and Business

Federal appeals court rules the structure of CFPB is unconstitutional

The Washington Post: A federal appeals court dealt a blow to the government’s consumer watchdog Tuesday by ruling that the structure of the agency is unconstitutional.

The U.S. Court of Appeals for the District of Columbia found that the setup of the Consumer Financial Protection Bureau, which is led by a single director, is not in line with other independent agencies, which are typically run by a group of commissioners.

The decision was a response to a petition from mortgage lender PHH, which challenged an enforcement action from the agency and called for the CFPB to be eliminated.

But the court decided against shutting down the CFPB, instead ordering that the agency be restructured so that the director could be removed by the president at will. Currently, the director can only be removed with cause — a system that Judge Brett Kavanaugh said lacked checks and balances.

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