The Supreme Court May Soon Eviscerate The Consumer Financial Protection Bureau

LOADING ERROR LOADING The conservative Supreme Court could soon eviscerate a key part of Congress’ response to the 2008 global financial crisis, with payday lenders challenging the constitutionality of the Consumer Financial Protection Bureau in one of the first hearings of the court’s new term. Instead of dealing with the history of the appropriations clause, the 5th Circuit claimed that the CFPB’s funding mechanism circumvented the separation of powers by limiting Congress’ oversight and appropriations authority over the executive branch. Steve Helber via Associated Press Huq and five other law and history professors filed a brief with the Supreme Court in the CFPB case detailing the actual history of the appropriations clause’s legal interpretation. “These claims are belied by the nation’s earliest laws, ‘contemporaneous and weighty evidence of the Constitution’s meaning.’” The 5th Circuit’s decision also relied on a misinterpretation of the CFPB’s funding source in its claim about a “double insulation from Congress’s purse strings.” This argument states that the CFPB’s funding comes from the Federal Reserve Board and not “the Federal Reserve,” which, it claims, acts as an inappropriate financing body circumventing Congress’ constitutional role. “You cannot invalidate the CFPB’s funding mechanism without invalidating the funding mechanism of the Federal Reserve,” Huq said.