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A day before ""Consumer Financial Protection Bureau (CFPB)"":http://www.consumerfinance.gov/ director Richard Cordray ""testified"":http://www.banking.senate.gov/public/index.cfm?FuseAction=Hearings.Hearing&Hearing_ID=765a704e-a287-4f96-910e-5866ac0fc352 before the Senate Committee on Banking, Housing and Urban Affairs to deliver his semi-annual report, ""Rep. Jeb Hensarling (R-Texas),"":http://hensarling.house.gov/ chair of the House Committee on Financial Services--which was also slated to hear from Cordray--announced his committee cannot accept Cordray's testimony as Cordray's appointment is not legal.
[IMAGE]Cordray's January 4, 2012 appointment--issued by President Barack Obama--was brought into question following a unanimous ""decision"":http://dsnews.comarticles/federal-appeals-court-ruling-leads-to-questions-of-cordrays-appointment-2013-01-25 in a federal appeals court a year later that determined three other appointments that occurred the same day were invalid.
""The court's unanimous ruling makes it clear that there is no legally-appointed director of the CFPB at this time,"" Hensarling said. ""By law, the committee can receive this testimony only from a director who is appointed in accordance with the Constitution and the Dodd-Frank Act, which created the bureau.""
Hensarling intends to ""conduct rigorous oversight"" of the agency until the leadership issue is resolved, but he does not accept Cordray's continuation of his position as director.
Hensarling is not alone in his concerns. During the Senate hearing Tuesday, ""Sen. Mike Crapo (R-Idaho)"":http://www.crapo.senate.gov/ expressed ""concerns with the structural nature of the agency,"" saying he and others ""continue to seek a change from the sole directorship to a board-like structure.""
[COLUMN_BREAK]""I continue to believe the recess appointment was unconstitutional,"" Crapo said.
In his statement Monday, Hensarling called for a bipartisan commission to direct the CFPB, adding that a bipartisan board is the originally intended structure of the bureau when it was introduced by President Obama and the Dodd-Frank Act.
""Sen. Jerry Moran (R-Kansas)"":http://www.moran.senate.gov/public/ introduced a bill earlier this year aimed at replacing Cordray with a five-person board. His bill gained immediate ""support"":http://www.cuna.org/Stay-Informed/News-Now/Washington/New-bill-re-introduces-five-member-CFPB-leadership-plan/?CollectionId=5 from the ""Credit Union National Association."":http://www.cuna.org/
In a ""letter"":http://financialservices.house.gov/uploadedfiles/4-22-13_jh_to_cordray.pdf to Cordray himself, Hensarling stated, ""Absent contrary guidance from the United States Supreme Court, you do not meet the statutory requirements of a validly-serving director of the CFPB, and cannot be recognized as such.
Hensarling simultaneously ""informed"":http://financialservices.house.gov/uploadedfiles/4-22-13_jh_to_fuchs.pdf CFPB associate director and general counsel, Meredith Fuchs that he ""stands ready to accept the testimony of the director of the CFPB on the semi-annual report as soon as an individual validly holds this position.""
Hensarling is particularly concerned with the amount of power a sole director of the agency holds.
""No other regulator has more influence over the daily financial lives of Americans,"" he said.
""How is it fair to American consumers that one unelected, unaccountable bureaucrat in Washington has the power to decide what kind of mortgage, car loan or credit card they can or cannot have?"" Hensarling asked.
""No bureaucrat should have so much control over the financial destiny of Americans, particularly one who is completely insulated from the types of checks and balances that apply to other government agencies,"" he added.
