In a case of potential significance for any company that finds itself the recipient of a civil investigative demand from the CFPB, a finance company has filed suit to prevent the bureau from disclosing its investigation of the firm and from taking any action against it unless and until the agency is restructured in line with the U.S. Constitution. “Plaintiff moves for a temporary restraining order and preliminary injunction prohibiting the CFPB and its director from using the executive, legislative and judicial powers delegated to the bureau to impose any restriction on plaintiffs’ liberty or otherwise take any action adverse to plaintiff unless and until the bureau is constitutionally structured,” said the company. The corporate entity, chartered in California with ...
Sen. Sherrod Brown, D-OH, and Rep. Maxine Waters, D-CA, late last week submitted a motion with the U.S. Court of Appeals for the District of Columbia Circuit seeking to intervene on behalf of the CFPB in its action against PHH Corp. “Movants now seek to intervene in this litigation because recent events have made it clear that their interests in preserving the leadership structure they voted for [in enacting the Dodd-Frank Act] may no longer be adequately represented by the new administration,” Brown and Waters argued. “Indeed, absent intervention, it is possible that the panel’s decision will be insulated from review, thus nullifying movants’ votes to establish the CFPB as an independent agency and their ability to establish similar independent ...
Late last week, PHH Corp. followed up on the opportunity afforded it by the U.S. Court of Appeals for the District of Columbia Circuit and filed its legal response to the arguments the Department of Justice made late last year in defense of the CFPB’s petition for an en banc rehearing in its dispute with the mortgage lender.The DOJ’s brief “asserts support for rehearing en banc, but not for any of the reasons advanced by the CFPB,” PHH said. “Indeed, the brief never actually defends the CFPB’s structure as consistent with the Constitution. Nor does the brief claim anywhere that the panel erred in its choice of remedy, its decision to reach the separation-of-powers issue, or its discussion of ...
The CFPB Office of Inspector General recently initiated an evaluation of the bureau’s use of vendors to support its analysis of fair lending compliance, the OIG indicated in its latest work plan. The OIG begins by noting, among other responsibilities, the CFPB is charged with providing oversight and enforcement of federal laws intended to ensure the fair, equitable and nondiscriminatory access to credit. But what may surprise many in the industry is to learn that the agency relies on external vendors to help fulfill this responsibility. “Our objective is to assess whether the CFPB effectively mitigates the risk associated with the use of vendors to support fair lending analysis, particularly with respect to potential conflicts of interest,” said the OIG ...
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