More On Legal & Compliancefrom The Advisor's Professional Library
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The United States Supreme Court decision Monday to hear a case over the validity of President Barack Obama’s recess appointments of three people to the National Labor Relations Board on Jan. 4 will “effectively determine” the constitutionality of Richard Cordray’s appointment as director of the Consumer Financial Protection Bureau, said House Financial Services Committee Chairman Jeb Hensarling.
“The legal validity of any and all actions undertaken by the CFPB are now questionable,” Hensarling (right), a Texas Republican, said in a statement.
Because Obama also attempted to install Cordray as director of the CFPB “on the same day and in the same manner, the Supreme Court’s decision regarding the constitutionality of the NLRB appointments will effectively determine the constitutionality of Cordray’s appointment as well,” Hensarling said.
In 2010, “congressional Democrats and the Obama administration bestowed upon the CFPB director the power to impact the availability and affordability of credit for every single American,” Hensarling continued. “This single unelected, unaccountable bureaucrat has the unprecedented power to decide what financial products and services will — and will not — be available to American consumers.
"No bureaucrat in Washington should have the power to deny a credit card to a hardworking single mother trying to put food on the table, a mortgage to a couple trying to buy their first home, or a car loan for a family. It should be up to individual consumers to determine whether a product is the right fit for their lifestyle and financial planning — not a Washington bureaucrat.”
Hensarling said that Congress and the administration should make “common-sense reforms” to the CFPB so it is transparent and accountable to the American people, and ensure that it’s “governed by a bipartisan commission — which is how other federal agencies charged with consumer or investor protection operate.”
The CFPB, he said, should also “be subject to the same appropriations process as other agencies.”
Noting that the House “passed similar legislation in the last session of Congress,” Hensarling said the financial services committee “will once again advance a proposal to bring accountability and oversight to the CFPB.”
Check out Top 13 Regulatory Predictions for 2013 on AdvisorOne.