SIDEBAR - Supreme Court Rules CFPB Structure Unconstitutional: Implications for Congress

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By Austin Songer. Discovered by Player FM and our community — copyright is owned by the publisher, not Player FM, and audio is streamed directly from their servers. Hit the Subscribe button to track updates in Player FM, or paste the feed URL into other podcast apps.
On June 29, 2020, in the case Seila Law v. Consumer Financial Protection Bureau (CFPB), the Supreme Court held in a five-to-four decision that the statutory provision limiting the President’s authority to remove the director of the CFPB violated the Constitution by infringing on the President’s powers to execute the laws. The opinion provides guidance on Congress’s authority to insulate agencies from presidential influence by explaining that, under current precedent, Congress may shield executive branch officials from removal by the President only in two limited circumstances: (1) when so-called inferior officers have limited duties and no policymaking or administrative authority, and (2) when a multi- member body of experts does not wield substantial executive power. In the view of the majority, the CFPB’s leadership structure, which included a sole director wielding substantial power, did not fit within either exception and was therefore unconstitutional. Despite this determination, the Court held that the restriction limiting the President’s ability to remove the CFPB Director is severable from the rest of the statute, which means the agency may otherwise continue to exercise the powers assigned by Congress with a Director who is removable at the President’s discretion. This Sidebar explains the Court’s holding in Seila Law, summarizes two partially concurring and dissenting opinions, and previews considerations for Congress.

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