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by G. Steven Bray
There was much cheer in the real estate industry after last year’s surprising election results. Finally, it would get some relief from the overreaching efforts of the Consumer Financial Protection Bureau (CFPB). Specifically, many figured that Bureau director Richard Cordray’s days were numbered. Well, it hasn’t worked out that way.
Dodd-Frank, which created the CFPB, stipulates the Predsident may only fire Cordray “for cause.” A three-judge panel of the D.C. appeals court last year ruled that the “for cause” language is unconstitutional, which seemed to clear the way for a “you’re fired” moment. However, the court first stayed that ruling and now has agreed to rehear the case. The new hearing is set for late-May with a decision unlikely until late summer.
Industry insiders think it now is unlikely Trump will fire Cordray until the case is decided because the President would have to show cause. It is certain Democrats would file suit to block the firing, which likely would postpone the firing while that case was adjudicated.
The Bureau’s actions over the next few months may dictate the urgency with which Trump feels to act. Recently, it seems the Bureau has focused on aggressive enforcement actions rather than creating new regulations, which make it more likely to fly below the radar.
Meanwhile, Congressional Republicans are moving a bill to replace the Bureau’s single director with a 5-member commission, similar to many other government agencies. However, the bill needs Democratic support to pass, and unless and until the appeals court rules, Dems seemingly have little incentive to acquiesce.
Once the court rules, it’s likely the losing side will appeal to the Supreme Court. That appeal wouldn’t be heard until the fall court term, and at that point Republicans expect the Senate will have confirmed Neil Gorsuch to the court.
Thus, the case may not be resolved for many months, with Cordray in charge of his own destiny. And that actually may be how this plays out. Political pundits believe Cordray is eyeing a run for Ohio governor in 2018. If he can ride out the current court battle, he can leave under his own terms later this year just in time to file for the election.
