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Hensarling: Cordray may have been appointed illegally

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Mortgage Professional America | 01 Jul 2014, 08:08 AM Agree 0
The director of the Consumer Financial Protection Bureau may not have always been serving “validly and legally,” according to the chairman of the House Financial Services Committee
  • Allan Daniels | | 01 Jul 2014, 10:30 AM Agree 0
    Notice of Ratification
    The President appointed me as Director of the Bureau of Consumer Financial Protection on January 4, 2012, pursuant to his authority under the Recess Appointments Clause, U.S. Const. art. II, § 2, cl. 3. The President subsequently appointed me as Director on July 17, 2013, following confirmation by the Senate, pursuant to the Appointments Clause, U.S. Const. art. II, § 2, cl. 2. I believe that the actions I took during the period I was serving as a recess appointee were legally authorized and entirely proper. To avoid any possible uncertainty, however, I hereby affirm and ratify any and all actions I took during that period.
    Dated: August 27, 2013.
    Richard Cordray,
    Director, Bureau of Consumer Financial Protection.
    [FR Doc. 2013–21275 Filed 8–29–13; 8:45 am]
  • Marc Savitt | | 01 Jul 2014, 10:38 AM Agree 0
    The Supreme Court decision is a precedent and therefore does have an impact on the CFPB Director. He was appointment on the same day and in the same manner as those on the NLRB.

    Under Dodd-Frank, until the CFPB had a Senate confirmed Director, their authority was limited, especially when it came to non-banks. During the 18 months Mr. Cordray operated under his recess appointment, numerous rules and regulations were proposed and finalized. As the Director- Mr. Cordray signed those final rules. After his Senate confirmation, he re-signed those rules and regulations. This in itself is somewhat of an admission by the Director that his previous actions were NOT valid.

    If a mortgage originator acted in that capacity for 18 months without being licensed and became licensed at a later time, would the CFPB allow that MLO to go back and sign all those mortgage applications and be considered compliant? We all know the answer is NO! So why is it different for the CFPB? The rules are for everyone.

    I suspect someone who has been heavily fined by the CFPB, might test the waters with this decision.

    In my opinion, the CFPB is vulnerable with this issue.
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