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Appeals Court Rules CFPB Unconstitutional: CEI Applauds Ruling As Win for Limited Government

Tuesday, October 11, 2016 10:53
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“This is a great day for limited government and the constitutional separation of powers,” said Competitive Enterprise Institute (CEI) General Counsel Sam Kazman, following a ruling in PHH Corp. v Consumer Financial Protection Bureau that found the CFPB to be unconstitutional.

The United States Court of Appeals for the District of Columbia found the CFPB’s structure to be unconstitutional. It invalidated the Dodd Frank provision that made its director removable only for cause, and ruled that in fact the President has authority to remove the CFPB director at will.

“Today’s ruling will play a major role in providing proper accountability for this rogue agency,” said Kazman. “It also opens the door for CEI’s district court case, State National Bank of Big Spring v. Lew, to move forward, challenging the constitutionality of other aspects of CFPB.”

That case was reinstated by an appeals court panel in July, 2015, and has been on hold in district court awaiting a ruling in the PHH case. State National Bank filed an amicus brief on the constitutional issues in PHH.

In today’s ruling the court described the CFPB director as “even more powerful than the President” in terms of his jurisdiction, and pointed out the nearly unprecedented nature of a single-headed agency headed by someone whom the President could not remove at will.

Tuesday, October 11, 2016
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