Politics & MoneyMortgage

Hensarling: SCOTUS ruling against recess appointments should apply to CFPB

Director Cordray's appointment just like the NLRB picks

The Supreme Court fired a huge salvo on the Obama administration, unanimously rebuking the White House for making recess appointments when Congress wasn’t actually in recess.

The court ruled that President Obama exceeded his Constitutional authority when he filled vacancies on the National Labor Relations Board in 2012. The ruling only has an effect on those specific NLRB recess appointments, and not on previous such recess appointments made when Congress was not recessed.

(To read the Supreme Court opinion, click here.)

One such recess appointment not subject to the ruling is the director of the Consumer Financial Protection Bureau, Richard Cordray.

Cordray's recess appointment, covered here at HousingWire, in January 2012, came after Senate Republicans blocked the appointment in early December 2011. 

"There's no question that Richard is the right person for the job," Obama said during the announcement. "When Congress refuses to act … then I have an obligation to do as president what I can without them." 

That obligation and action was unconstitutional, it turns out.

Dan Pfeiffer, White House Communications Director at the time,  announced the appointment in a post on the White House blog.

He called the Senate pro forma sessions "a gimmick…But gimmicks do not override the president's constitutional authority to make appointments to keep the government running," Pfeiffer said. 

The Supreme Court's ruling Thursday proved that assertion absolutely wrong, even if the ruling won't affect Cordray's appointment, since he is already ensconsed. It does raise other questions, though, about opening up the CFPB to legal liability.

House Financial Services Committee Chairman Jeb Hensarling, R-Texas, issued the following statement today after the ruling was announced.

“President Obama appointed Richard Cordray to head the CFPB at the same time and in the exact same manner as these unconstitutional NLRB appointees.  Clearly and unquestionably, President Obama exceeded his authority when he appointed Director Cordray, just as he exceeded his authority when he made these NLRB appointments,” Hensarling said. 

“Today’s unanimous judgment from the highest court in the land reaffirms and validates our committee’s decision not to hear testimony from Director Cordray on the CFPB’s semi-annual report until he was validly and legally serving in his position,” he said.

Hensarling said that by the time the Senate confirmed Cordray in July 2013, he had served as director for 18 months without legal authority. 

“This fact calls into question the legality of the official actions he took during this time period and may represent a legal risk for the CFPB,” Hensarling said.

(HousingWire submitted questions to Hensarling’s office on what, if any, actions he believed Congress could take, but no responses were received by publication. Story will be updated if a response is forthcoming.)

Most Popular Articles

Is the U.S. in a housing bubble?

“Unlike the bubble years, purchase application data, existing home sales, new home sales, housing starts and the lack of cash-out refinancing all point to slow and steady growth.”

Jan 28, 2020 By

Latest Articles

The hottest neighborhoods of 2020

Redfin recently revealed the hottest neighborhoods of last year, but that was last year. What about which neighborhoods are going to be hottest ones this year? We have the answers.

Jan 29, 2020 By
3d rendering of a row of luxury townhouses along a street

Log In

Forgot Password?

Don't have an account? Please