Supreme Court gives president power to fire head of financial watchdog agency created by Elizabeth Warren

 

Written by: Nihal Krishan | Published by the Washington Examiner on June 29, 2020


The Supreme Court ruled Monday that the structure of the Consumer Financial Protection Bureau is unconstitutional, determining that its head must be removable at the will of the president.

The decision reduces the power of the agency, the brainchild of Elizabeth Warren, and is a victory for business groups. The court stopped short, though, of eliminating the bureau, as sought by conservatives.

“The agency may therefore continue to operate, but its Director, in light of our decision, must be removable by the President at will,” Chief Justice John Roberts wrote for the 5-4 majority.

The decision agreed with a California-based law firm’s argument that the bureau’s leadership structure, featuring a sole director who was removable “only for cause,” violated the separation of powers rule under the U.S. Constitution.

The ruling overturns a federal district court ruling and appellate court decision that had rejected the law firm’s arguments. Cases challenging the constitutionality of the agency have been weaving their way through the lower courts in the past few years.

In 2016, Justice Brett Kavanaugh, then a judge on the U.S. Court of Appeals for the District of Columbia Circuit, said in a ruling in a similar case that the director of the CFPB was, except for the president, the “single most powerful official in the entire U.S. Government, at least when measured in terms of unilateral power.”

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