The State National Bank of Big Spring, Texas, the Competitive Enterprise Institute (CEI), and the 60 Plus Association on September 6 petitioned the United States Supreme Court to hear a lawsuit challenging the constitutionality of the Consumer Financial Protection Bureau.
“Dodd-Frank gave unelected bureaucrats czar-like power over America’s financial system, and the Bureau has used that power to inflict damage on businesses and consumers alike,” said CEI General Counsel Sam Kazman. “The Supreme Court should intervene to restore the Constitution’s checks and balances on this unrestrained government power and to make it clear that Congress cannot abdicate its power of the purse.”
The lawsuit argues the Dodd–Frank Wall Street Reform and Consumer Protection Act hands the CFPB an unprecedented combination of expansive, unchecked, and unaccountable executive authority that uniquely threatens the liberty of American businesses and consumers.
Specifically, the petition points to the fact that the Bureau is led by a single director that the president cannot remove from office for policy reasons, that Congress has no control over the Bureau’s funding, and that the Bureau lacks even the internal checks and balances of a multi-member commission. The petition warns that if the CFPB stands as-is, it will become a blueprint for creating future regulatory agencies.
A 2017 CEI report listed CFPB abuses against auto, mortgage, and payday lenders, which not only abruptly and unjustly penalized lawful businesses but threatened to restrict consumer access to such loans.
“CEI has praised many of the policy initiatives of the CFPB — now also referred to as the Bureau of Consumer Financial Protection — since it has been under the management of Mick Mulvaney, but the need for the Bureau to have proper constitutional checks and balances is still as important as ever,” said CEI Senior Fellow John Berlau.
The lawsuit is on appeal from the United States Court of Appeals for the District of Columbia Circuit.
> View the cert petition in State National Bank of Big Spring v. Mnuchin at cei.org/doddfrank