WASHINGTON–Pointing to what it is calling “regulatory chaos,” Lower East Side People FCU has filed suit in federal court to stop President Trump’s appointment of Mick Mulvaney to lead the Consumer Financial Protection Bureau (CFPB).
The suit alleges “regulatory chaos” has been caused by the legal dispute over who is rightfully in charge of the agency. A federal court has already ruled that Trump’s appointment of Mulvaney to the post is legal, in response to a lawsuit that had been filed by Leandra English, the CFPB’s deputy director, who had argued the language in the Dodd Frank Act is clear that the deputy director oversees the agency in the event of an absence in the director’s position.
A vacancy was created at the CFPB when Richard Cordray resigned; Cordray had elevated English to deputy director with the assumption she would then take the top spot. English is continuing to pursue her case, despite the earlier decision.
In its lawsuit, the $55-million Lower East Side People’s Federal Credit Union wants the federal court to remove Mulvaney and affirm that English is properly the person to be leading the CFPB.
The lawsuit was filed by New York-based Lower East Side People’s FCU in U.S. District Court in Manhattan
“The Credit Union does not know who is validly in charge of the CFPB, who is authorized to make the rules, or whose rules to follow,” according to LESPFCU’s complaint. “The Court must resolve this regulatory chaos. It must determine who is in charge of the Bureau. To the Credit Union, it is plain that Leandra English is the only lawful Acting Director in charge of the CFPB,” the lawsuit said.
In response to the filing of the suit, NAFCU CEO Dan Berger issued a statement saying, "While Lower East Side People's Federal Credit Union is not a member of NAFCU, we were surprised to see the lawsuit. Since the CFPB's inception, NAFCU has worked with the bureau to ensure credit unions' needs are heard. We look forward to continuing to reduce unnecessary regulatory burdens on credit unions, including regulation promulgated by the CFPB, as we outlined in a letter to Interim Director Mulvaney last week.”
Both CUNA and NAFCU have been supportive of the appointment of Mulvaney, a CFPB critic who has vowed to roll back the agency’s rulemaking and enforcement.