Washington D.C. – The National Treasury Employees Union today urged the U.S. Supreme Court to help protect American consumers from fraud by allowing the Consumer Financial Protection Bureau to remain open and rejecting claims that the agency’s funding structure is unconstitutional.
In a brief NTEU filed today at the Supreme Court, the union argued a lower court wrongly decided that Congress violated the Constitution when it authorized the Federal Reserve to transfer a limited amount of funds to CFPB for its operations every year, instead of requiring the CFPB to go through the annual appropriation process in Congress. The U.S. Court of Appeals for the Fifth Circuit’s ruling was at odds with every other federal court to hear the issue, the brief states.
“Congress has exercised its constitutional prerogative to fund the CFPB in a manner of its choosing; the CFPB, in turn, has abided by the limits that Congress has set on its funding,” according to NTEU’s brief.
If the Fifth Circuit’s ruling stands, CFPB’s important work on behalf of American consumers would grind to a halt.
“Its dedicated workforce will no longer be able to pursue enforcement actions against those who violate federal law, issue guidance to industry, or respond to consumer complaints. The American people, in other words, would be the ultimate losers of this litigation,” NTEU’s brief states.
Congress created the CFPB in 2011 to help shield Americans from unfair, deceptive and abusive financial products and practices. Since then, CFPB has delivered more than $16 billion in relief to American consumers while handling more than three million complaints.
NTEU represents about 1,000 frontline employees at CFPB, including professional accountants, auditors, examiners, and consumer finance experts who are committed to making sure financial products Americans use every day – such as credit cards, automotive financing, and home mortgages -- are fair, transparent and competitive. The agency also has a special focus on protecting military servicemembers from mistakes in their credit histories and fraudulent practices related to their frequent relocations.
“Recognizing our nation’s obligation to help those who serve, the CFPB specifically focuses on assisting servicemembers by responding to hundreds of thousands of complaints annually and by issuing recommendations specific to servicemembers and their families,” NTEU wrote.
The legal turmoil over the agency’s future and any potential interruption in operations could cause the agency to lose skilled employees.
“The CFPB has an outstanding record of helping consumers avoid fraud and scams and holding financial institutions accountable,” said NTEU National President Tony Reardon. “We ask that the Supreme Court reject the Fifth Circuit’s outlier decision and allow the public servants of CFPB to continue their valuable work."
NTEU represents employees in 34 federal agencies and offices.