Supreme Court Rules CFPB Director Can Be Removed At-Will

A limitation of the Dodd-Frank Act preventing the President of the United States from removing the Director of the CFPB for reasons beyond "inefficiency, neglect of duty or malfeasance" was rejected by the Court, contending the stipulation created a level of unconstitutional insulation for the position.

While the court ruled in favor of removing this limitation, it chose not to strike down the CFPB in its entirety, finding that the constitutional issue created by the "for-cause" removal restriction is severable from the other statutory provisions bearing on the CFPB's authority.

In this case brought before the Supreme Court by Seila Law, the Trump administration joined the appeal, arguing that the President's oversight of the executive branch is undermined as a result of this removal restriction pertaining to the directorship of the CFPB.

Posted: July 8, 2020