A battle is being waged over who would wrest control over Consumer Financial Protection Bureau (CFPB). On one side is the former President Barack Obama administrators and opposing them is the present President Donald J. Trump appointees. Things became complicated after Richard Cordray, a Democrat and the outgoing director, formally submitted his resignation. Prior to leaving, he appointed Leandra English, his ex-chief of staff, to take his position on a temporary basis.
Past and present collide
Former President Barack Obama appointed Cordray as the first director of the CFPB. The head soon developed a stellar reputation for drafting tough rules that curbed financial products like payday loans. It also issued fines to huge financial institutions. Among the many companies which faced multi-million-dollar fines included ones like Wells Fargo.
President Trump was quick to take action. He named Mick Mulvaney, his budget chief, to take over the agency as its acting director. Mulvaney, a known CFPB critic, was to administer the agency until Trump could get the Senate to appoint a permanent successor. This process may take many months. The twist began when English legally challenged the Trump administration and sought to block the appointment of Mulvaney. This move implies that the filling up of the temporary leadership vacancy present at the CFPB will be decided by a federal court. This fight stems from two competing visions on the regulation of the financial system in the United States. Trump disliked the agency so much that he termed it as a 'total disaster' in one of his social media outbursts. He claimed that the agency has wrecked financial institutions. The President has promised to repeal all Obama-created financial regulations.
Mulvaney, in his position as the acting director, will have the power to execute decisions having far-reaching effects related to supervision and also enforcement of the financial firms. If the Trump administration has to be believed, he will acquire the power to appoint his chosen acting director as per 1998 Federal Vacancies Reform Act.
The CFPB was created after the financial crisis so that consumers can be protected from the vagaries of predatory lending. GOP hate the regulatory body as they believe it has excessive power. According to Republicans, the organization burdens banks and a number of other lenders with more than necessary red tape.
The Democrat-era appointees of the CFPB receive support from consumer advocates and also liberal groups. These two will hold a rally near the entrance of the organization during the last week of November to show their support for the agency.