High profile case before the U.S. Supreme Court has potential implications for the future of the bureau.
12/2/2019 9:00
A monumental case focused on the constitutionality of the Consumer Financial Protection Bureau’s leadership structure will continue before the U.S. Supreme Court with oral arguments on March 3, 2020.
Dubbed as one of the “highest-profile” cases for the court in its upcoming session by SCOTUSblog reporter Amy L. Howe, Seila Law v. Consumer Financial Protection Bureau presents the Supreme Court with the decision to determine whether the provision of the law allowing the president to remove the agency's director only for cause violates the constitutional separation of powers.
The court will also review, whether, if the CFPB “is found unconstitutional on the basis of the separation of powers, it can be severed from the Dodd-Frank Act,” Howe reports.
In?Seila Law, a 9th Circuit panel unanimously ruled the CFPB’s single director structure was?constitutional, prompting Seila to file a brief asking the Supreme Court to hear the case to review that finding. This marks the first time since the CFPB’s inception that agency leadership and the DOJ will not defend the structure of the bureau in litigation.
The accounts receivable management industry has a huge stake in the case and will continue to monitor the legal challenge as it unfolds, in particular as ACA and in the industry continue to seek clarity from the CFPB regarding compliance with the Fair Debt Collection Practices Act. The CFPB has taken important steps to address the industry’s concerns by issuing a Notice of Proposed Rulemaking to update the FDCPA – which ACA commented on in a 154-page letter.
ACA also presents more analysis of the implications of the case on ACA Cast: Legal Review: Understanding the Challenge to the Constitutionality of CFPB’s Leadership Structure.
It’s worth noting that the ongoing questions surrounding the constitutionality of the bureau’s leadership structure are pertinent for all industries impacted by regulatory policies and enforcement decisions made by the CFPB. And at this point, it’s up in the air as to how the court will rule. Jessica Klander, shareholder at Bassford Remele, provides insights on the most important issues relevant to this case and the bigger picture related to the potential future of the CFPB.
Read more on the case in ACA’s coverage: SCOTUS to Hear Possible Game-Changing CFPB Case.