Leading Democrats signed onto an amicus brief on November 29, joining what is proving to be a contentious court case between the Consumer Financial Protection Bureau (CFPB) and the PHH Corporation ( PHH Corp. v. Cons. Fin. Protection Bureau, D.C. Cir., No. 15-01177, 11/18/16 ).
The appeal responds to an earlier decision by a three-judge panel of the D.C. Circuit Court of Appeals to strike down the current structure of the CFPB. Now, the CFPB will be supported by 20 current and former Democratic members of Congress, including Rep. Maxine Waters (D-CA), the ranking member of the committee on financial services.
“By severing the for-cause removal provision, the panel decision fundamentally altered the CFPB’s structure in a way that is at odds with Congress’s design and will undermine the CFPB’s ability to fulfill its important role under Dodd-Frank,” the Democrats wrote.
The brief lays out the reasons Congress had previously structured the CFPB, specifically, with a single overseeing director able to be removed only for cause. The legislators within claim the need for the bureau to regulate effectively through relative independence. If the bureau was forced to submit to a commission based structure, as the previous case determined necessary, the brief contents it would hamper the CFPB’s ability to react to threats to consumers.