SCOTUS Speaks: CFPB Structure Unconstitutional

Updated 6/29/2020 at 4:07PM to reflect that the Supreme Court requested the appellate court review whether the government's petition to enforce the CID should be denied.

The question of whether the Consumer Financial Protection Bureau's (CFPB) structure is constitutional or not has been floating around the judicial system for a couple of years now. As of today, we finally have an answer. Today, the U.S. Supreme Court (SCOTUS) issued an opinion finding the CFPB's structure unconstitutional in the Seila v. CFPB.

The main issues raised regarding the constitutionality of the CFPB's structure revolve around the separation of powers clause. Specifically, the question of whether having a single director removable by the President only for cause is problematic considering the CFPB's unique independence as a federal agency. SCOTUS decided it was a problem indeed, but one that can be remedied through severability—meaning the rest of the rules surrounding the CFPB's function and structure can remain intact.

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