Hearing Examines Unconstitutional Structure of CFPB

March 21, 2017

On Tuesday, March 21, 2017, the House Financial Services Subcommittee on Oversight and Investigations examined whether the CFPB’s structure violates the “Separation of Powers Clause” in Article II of the Constitution. Members discussed possible changes to enhance the constitutionality and accountability of the Bureau, as it is not subject to checks and balances, such as a commission structure, appropriations oversight or serving at the pleasure of the President. Three of the four witnesses voiced concern about the agency’s structure, asserting its current form is unconstitutional, while the fourth witness argued it is constitutional and pointed to the work of the Bureau.  Overall, Republicans focused on the constitutionality concerns while Democrats touted the CFPB’s work.  Republicans claimed Democrats were using an “ends justify the means” argument to support the Bureau’s current structure.  

 

CBA submitted a letter for the record highlighting the need for a bipartisan commission and stating, “As we know, the CFPB’s actions can have incredible ramifications on the financial industry and our economy.  This hearing serves the important purpose of examining the constitutionality of the agency and remedies to its structure which will ensure the longevity of the CFPB and its ability to protect consumers.  It is imperative the CFPB’s structure is stable, deliberative, and bipartisan – for the sake of the American consumer and the U.S. economy.” More information on the hearing can be found here.