Republican staff of the U.S. House of Representatives Committee on Financial Services (the “Committee”) released a report that lays out a case for instituting contempt of Congress proceedings against Consumer Financial Protection Bureau (“CFPB”) Director Richard Cordray.
In the staff report, the Republicans accuse Mr. Cordray of failing to comply with the Committee’s oversight of the CFPB, particularly regarding the recently adopted CFPB arbitration rule that concerns pre-dispute arbitration agreements. According to the report, Mr. Cordray refused consistently to comply with requests for records and documents related to the rule. In response, the Committee issued a congressional subpoena in order to compel the CFPB to produce the relevant records. The staff alleged that Mr. Cordray was legally obligated to address the congressional subpoena but failed to respond adequately. As a result, the Republicans accused Mr. Cordray of defaulting on the subpoena and asserted there is ample basis to proceed against Mr. Cordray for contempt of Congress.
Lofchie Comment: Agree or disagree with the policies of Mr. Cordray, it is just impossible to figure out how the CFPB fits within the structure of the government as established by the U.S. Constitution. The government has three branches: the Legislative (Article 1), the Executive (Article 2) and the Judicial (Article 3). Where does the CFPB fit into that structure? It seems troubling that the CFPB is not responsible to any of the branches. That is not a good way to run a railroad or a government.