The attorneys general of eight states are requesting to join three other states in a lawsuit that challenges the constitutionality of the 2010 Dodd-Frank Act and the Consumer Financial Protection Bureau.
Those joining the case, which was originally filed on behalf of a Texas community bank and two conservative groups, include Alabama, Georgia, Kansas, Montana, Nebraska, Ohio, Texas and West Virginia. Michigan, Oklahoma and South Carolina joined the lawsuit in September.
The states "argue that certain parts of Dodd-Frank are unconstitutional and hurt community banks, as well as giving too much power to 'unelected' officials," writes American Banker's Rachel Witkowski.
"The State of Texas is challenging Dodd-Frank because it gives too much power to the federal government - and puts taxpayer dollars at risk," said Texas Attorney General Greg Abbott in a press release announcing the decision. "Under this law, unelected federal bureaucrats are empowered to unilaterally liquidate financial institutions in which the state invests taxpayer dollars. This unprecedented regime deprives the State of Texas of basic due process rights and places taxpayers' resources at risk."
The defendants, which include nearly every federal financial regulator, have filed for the lawsuit to be dismissed. The case is waiting for a response from the plaintiffs.
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