Letter from leading Republicans to Director Cordray questions pre-confirmation actions


Following up on his earlier statement about the impact of the Supreme Court’s decision in NLRB v. Noel Canning on Richard Cordray’s actions taken prior to his July 16, 2013 confirmation by the Senate as CFPB Director, Republican Congressman Jeb Hensarling has sent a letter to Mr. Cordray in which he asserts that the decision raises questions about the validity of those actions and seeks “a complete and proper accounting of the CFPB’s exposure to legal challenges.” Mr. Hensarling chairs the House Financial Services Committee. The letter was also signed by Republican Senator Mike Crapo, the Ranking Member of the Senate Committee on Banking, Housing, and Urban Affairs.

In Canning, the Supreme Court held that President Obama exceeded his Constitutional recess appointment authority when he filled three vacancies on the National Labor Relations Board on January 4, 2012. Although Mr. Cordray’s recess appointment as CFPB Director was not at issue in Canning, his appointment was made on the same day and through the same assertion of recess appointment authority as the NLRB appointments.  

Citing to other Supreme Court precedent, Messrs. Hensarling and Crapo also assert in the letter that “there remains serious doubt as to your authority to ratify actions that took place” prior to confirmation. (On August 30, 2013, the CFPB published a notice in the Federal Register in which Director Cordray ratified his pre-confirmation actions.)

The information requested in the letter includes “any and all documents, communications and analyses, undertaken by CFPB officials and/or outside counsel” that is “related to the validity or standing of CFPB actions taken between January 4, 2012 and July 16, 2013 that are not derivative of Dodd-Frank, Title X, Subtitle F authorities” or “justif[ies] the CFPB’s authority and your standing to ratify past Bureau actions.” The letter asks Director Cordray to submit all responsive documents and materials by September 1, 2014.


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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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