Wednesday, January 4, 2012

Obama set to name Cordray to CFPB through recess appointment

President Barack Obama is set to name Richard Cordray to lead the new federal consumer financial protection bureau through a recess appointment, a tactic that a Charlotte-based banking lawyer sets up another partisan battle.

"I think it was a calculated political move on the part of the president of the United States to score points with his base and create a problem with Republicans who would challenge it," said Don Lampe, an attorney with Dykema's office in Charlotte.

The Consumer Financial Protection Bureau, created as part of the Dodd-Frank financial reform law as a watchdog for financial products like mortgages and credit cards, had gone without a permanent director in the face of opposition from Republicans.

Lampe said he expects in the coming hours for Republicans to make public statements questioning the president's constitutional authority to make such an appointment and calling it overreaching.

Liberal group ThinkProgress has already published a blog post explaining why it believes Obama had the authority to make the pick.

The naming of a director will affect non-banks -- like mortgage lenders and payday lenders -- more than deposit-taking institutions, Lampe said, due to the structure of the law. Banks are generally already subject to oversight from the bureau.

UPDATE: In a tweet, U.S. Rep. David Price, D-N.C., praisedObama's move, saying "Americans deserve a strong CFPB even if Senate GOP objects."

UPDATE: From the American Bankers Association -- "The controversial nature of today's recess appointment reinforces the banking industry's concerns about the Bureau's structure and lack of accountability. It puts the Bureau's future actions in constitutional jeopardy, threatening its work, complicating compliance efforts of banks and further undermining the entity's authority and credibility." Read more.


Anonymous said...

Great move. And its about time! Now maybe republicans can explain to us why it is that they're so against consumer protection and the kind of regulation that would have prevented the Great Recession to begin with.

Skippy said...

11:45 if you don't want caused the sub prime meldown by now, good for you, just stay dumb. As for this appointment, this is once again an unprecedented power grab by our Marxist Banana Republic "President". And what does the Oberver do, they run right to a liberal group who "thinks" he had the consitutional right to do this when in fact he did not. In fact President Moron, violated his own adminstrations policy to make this "recess" appointment when the Senate is still in session. This is yet more power for the Govt, more regulation tied to the bill written by two corrupt liberals in Dodd and Frank. Until we get this regime voted out, this country will continue it's backwards slide into welfare state.

Anonymous said...

good move Obama

Anonymous said...

Wow, the Bamster certainly has a set. To make a recess appointment while the Senate is in session is a stretch.

As for the do nothing Republican comments. Where is the budget from your side?