Judge Again Rules in Trump's Favor in CFPB Controversy

Judge Again Rules in Trump's Favor in CFPB Controversy

Mulvaney was appointed acting director under the Federal Vacancies Reform Act, which allows the president to name a now serving Senate-confirmed official as acting director for a set period of time or until a permanent director is confirmed.

This case concerns whether the President is authorized to name an acting Director of the Consumer Financial Protection Bureau ("CFPB") or whether his choice must yield to the ascension of the Deputy Director, who was installed in that office by the outgoing Director in the hours before he resigned.

On Nov. 26, English filed her lawsuit challenging Mulvaney's appointment in the US District Court for the District of Columbia.

In addition, a separate lawsuit filed in federal court in NY by the Lower East Side People's Federal Credit Union, which also seeks an injunction to remove Mulvaney, is set for a hearing Friday. A permanent replacement to Cordray would have to be nominated by the President and endorsed by the Senate. He also wrote that there was nothing in Dodd-Frank that barred the head of OMB from also serving as acting director of the CFPB.

Mulvaney has vowed to move the CFPB away from its agenda under Democratic President Barack Obama.

Mick Mulvaney speaking at CPAC 2011
Mick Mulvaney speaking at CPAC 2011

Kelly wrote that President Trump's authority to fill federal agency vacancies could "override" a leadership succession order laid out in the federal law that created the bureau, the Dodd-Frank Act.

Arguing that she is the agency's rightful director, English will likely appeal U.S. District Judge Timothy Kelly's ruling - but she might run in to a brick wall.

English - who was appointed to lead the CFPB by predecessor Richard Cordray - got into a perplexing dilemma after President Trump ignored Cordray's orders and tapped Mulvaney as the acting financial protection czar, even though he was already heading the government's Management and Budget Office.

English's attorney, Deepak Gupta, had previously indicated [LAT report] English would appeal, saying that "I think everyone understands this court is not the final stop, this judge does not have the final word on what happens in this controversy". English then filed the motion for a preliminary injunction to block Mulvaney's appointment, and Kelly heard arguments on December 22. They urge the Court to deny the injunction. He said in a statement to BuzzFeed News that they were disappointed with Kelly's decision. "Mr. Mulvaney's appointment undermines the Bureau's independence and threatens its mission to protect American consumers", Gupta said.

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