WASHINGTON The Consumer Financial Protection Bureau issued a statement Thursday saying a Supreme Court decision issued earlier that day involving presidential recess appointments did not have any impact on the agency's previous rulemakings.
The Supreme Court unanimously ruled that President Obama exceeded his constitutional authority by making recess appointments to the National Labor Relations Board in 2012 when Congress was still technically in session. CFPB Director Richard Cordray was initially given a recess appointment at the same time, although the case at issue never directly involved him.
Still, the decision likely would have put Cordray's appointment and any decision he made in office in legal jeopardy had the Senate not confirmed him as CFPB director in July of last year. One of Cordray's first actions after being confirmed was to ratify all the decisions he made in the 18 months he was in office as a recess appointee.
As a result, the CFPB said Thursday that it did not expect the court case to affect any of the CFPB's actions.
"We do not expect this decision to impact the CFPB or its important work," said Meredith Fuchs, the agency's general counsel, in a press release. "The CFPB was not part of this case, and today's decision does not include or mention the bureau or Director Cordray."
That did not stop House Republicans who previously challenged the legality of Cordray's appointment from noting they were right to stop him from testifying at certain hearings prior to his Senate confirmation.
"President Obama appointed Richard Cordray to head the CFPB at the same time and in the exact same manner as these unconstitutional NLRB appointees. Clearly and unquestionably, President Obama exceeded his authority when he appointed Director Cordray, just as he exceeded his authority when he made these NLRB appointments," said House Financial Services Committee Chairman Jeb Hensarling, in a press release Thursday. "Today's unanimous judgment from the highest court in the land reaffirms and validates our committee's decision not to hear testimony from Director Cordray on the CFPB's semi-annual report until he was validly and legally serving in his position."
Hensarling also raised doubts about the legality of Cordray's actions prior to his Senate confirmation.
"By the time the Senate confirmed Mr. Cordray in July 2013, he had served as Director for 18 months without legal authority," Hensarling said. "This fact calls into question the legality of the official actions he took during this time period and may represent a legal risk for the CFPB."
But observers appear to agree with the CFPB in saying the issue is now moot.
Isaac Boltansky, a policy analyst at Compass Point Research & Trading, issued a note Thursday telling clients in bolded letters that the ruling is "a non-event for the CFPB" because of Cordray's confirmation and following ratifications. He also noted that Senate Democrats had subsequently changed the rules surrounding filibusters of all non-judicial nominees, making it easier for them to be confirmed.
"More broadly, while the NLRB ruling may limit the President's authority to make recess appointments in the future, we note that the ultimate impact of this ruling is limited as the threshold for approval of nominees was reduced when the Senate embraced the 'nuclear option' in November 2013," Boltansky said. "Given that the NLRB ruling will have no direct impact on the CFPB, the agency will continue to implement it regulatory priorities."