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U.S. Chamber Condemns Unprecedented Recess Appointment of CFPB Director

Tuesday, January 3, 2012 - 7:00pm

‘This Controversial Appointment is Unprecedented, Constitutionally Questionable, and Puts the Authority of the Director and the Validity of the Bureau’s Work in Legal Jeopardy,’ Says Donohue

WASHINGTON, D.C.—U.S. Chamber of Commerce President and CEO Thomas J. Donohue issued the following statement today regarding the President’s unprecedented decision to circumvent Congress and recess appoint Richard Cordray as the director of the Consumer Financial Protection Bureau (CFPB):

“To say we are disappointed in the move by the President today would be a gross understatement.  This controversial appointment is unprecedented, constitutionally questionable, and puts the authority of the director and the validity of the bureau’s work in legal jeopardy.  What’s more, it ignores repeated calls to reform the bureau by restoring basic checks and balances.  The Senate has already made it clear that structural changes are needed before a director can be confirmed and the Executive Branch has defied convention to undermine that process.

“Today's move by the President robs Congress of its one opportunity to provide a check on the CFPB's broad and largely undefined reach.  The American people deserve the right to know how this agency will work and what it plans to do with half a billion dollars in annual funding.  The President had a choice to work with Congress to implement the necessary reforms for this agency.  Instead, he chose a political maneuver that ignores the advice and consent power of the Senate, harms consumers, and ensures that the CFPB’s authority will be challenged and resolved by the courts.

“We strongly believe it’s important to protect consumers from predatory lending, financial scams, and fraud in the marketplace.  But to be effective it must do so in a transparent and accountable manner.  Under its current structure, the CFPB is rife with uncertainty and has the potential to harm our economy and job creation.  A few simple fixes can go a long way to alleviate these concerns.  From the beginning, we have called for a bipartisan commission instead of a single director, requiring the bureau to submit its budget for Congressional approval.  The CFPB also needs a safety and soundness check to prevent it from making decisions that could come at the cost of financial institutions’ stability.  Putting the power to pick winners and losers in the credit markets in the hands of a single individual with a half-a-billion dollar annual budget threatens our economic recovery at the worst possible time. ”

The U.S. Chamber of Commerce is the world’s largest business federation representing the interests of more than 3 million businesses of all sizes, sectors, and regions, as well as state and local chambers and industry associations.