NEW YORK–A credit union that has filed suit against the Trump Administration over its appointment to lead the Consumer Financial Protection Bureau has now filed an additional brief following a tweet from the president--while CUNA Tuesday filed an amicus brief supporting Trump's appointment.
As CUToday.info reported here, Lower East Side People’s Federal Credit Union filed suit after a vacancy was created at the CFPB following Director Richard Cordray’s resignation. Cordray had elevated Leandra English to deputy director with the assumption she would then take the top spot. English has filed a lawsuit and appeal of her own arguing the Dodd-Frank Act, which created the CFPB, is clear in how succession should work at the CFPB. The Trump Administration disagreed, citing the Federal Vacancies Reform Act for the authority to appoint Mulvaney.
After the suit was filed, in response to some reports the CFPB might reduce penalties assessed Wells Fargo following its fake accounts scandal, President Trump tweeted out “Fines and penalties against Wells Fargo Bank for their bad acts against their customers and others will not be dropped, as has incorrectly been reported, but will be pursued and, if anything, substantially increased. I will cut Regs but make penalties severe when caught cheating!”
That tweet, alleges Lower East Side People’s in the brief it filed in Manhattan federal court, demonstrates the CFPB is not independent, but that it is “defendant Trump running the show. Now, with Mr. Trump over his shoulder, Mr. Mulvaney is trying to destroy” the agency.
Before the brief was filed, the court replaced Judge Ronnie Abrams, who was presiding over the trial, with Judge Paul Gardephe. Abrams had previously recused herself from two other Trump-related lawsuits since her husband, Greg Donald Andres, is part of special counsel Robert Mueller’s task force investigating the Russian meddling in the 2016 election.
CUNA Supports Trump
Tuesday CUNA filed an amicus brief in the U.S. District Court for the District of Columbia for the case in support of any president having the authority to appoint an interim director at the CFPB by the Vacancies Reform Act, rather than having an outgoing director select any person they want for the position. CUNA stated that the trade association and its members have a strong interest in ensuring that the CFPB at all times "operates under proper direction of the official who is statutorily and constitutionally entitled to act as its director."
“Americans deserve better than the political theater playing out at the CFPB right now,” said Jim Nussle, CUNA president/CEO. “It is important to have a process in place which assures leadership of the CFPB has transparency. We disagree that a non-accountable individual leaving office has presidential appointment powers with no checks and balances in place.
“As credit unions consider what services they can continue to offer their members, what their costs of compliance may be in the immediate future, and how they want to innovate, it is critical that they have certainty and transparency about the leadership of the CFPB,” continued Nussle. “The confusion stemming from this and other litigation surrounding this issue further demonstrate the need for a multi-person commission to lead the CFPB – consumers in need of financial services should not suffer as a result of political grandstanding.”
CUNA stated that uncertainty surrounding the CFPB’s leadership leaves credit unions guessing about the status of pending rules and rule effective dates, examination schedules, and the many other required credit union actions from the CFPB. "This can directly impact daily operations and the ability to provide the safest and most affordable financial services on a daily-basis to their members," CUNA said in a release.