Header graphic for print
MoFo Reenforcement The Enforcement Blog

U.S. Supreme Court Strikes CFPB Director For-Cause Removal Provision

Posted in CFPB

The U.S. Supreme Court issued its ruling in Seila Law LLC v. Consumer Financial Protection Bureau, holding that the CFPB’s leadership structure—with a single director removable only for inefficiency, neglect, or malfeasance—is unconstitutional because it violates the separation of powers. But the Court preserved the Bureau by severing the for-cause removal provision from the rest of the Dodd-Frank Act. The bottom line: the CFPB remains intact, but the President (or the next one) can remove the director of the CFPB for any reason. CFPB Director Kathy Kraninger commented that it is now clear that the agency and its director “are fully accountable to the President.”

Read our client alert.