VIVA LA CFPB II: If Agency Rebels Needed A Leader, It'll Probably Be Non-Acting Director Leandra English

Posted: Dec 07, 2017 5:20 PM

Okay—the leadership change at the Consumer Financial Protection Bureau has reached absurd heights. Richard Corday decided to resign in November; he’s probably going to run for governor of Ohio. Deputy Director for the CFPB, Leandra English, thought she was acting director through Cordray’s blessing. Nope—President Donald Trump appointed Office of Budget and Management Director Mick Mulvaney to run the show. English was not having it. She filed a lawsuit trying to block Mulvaney’s appointment. She failed. For now, the leadership battle is over; Mulvaney is acting director. Yet, that hasn’t stopped some staffers within the agency from forming the rebel alliance within the agency.

As we wrote before, they call themselves “Dumbledore’s Army,” and no—that’s not a joke. They reportedly are using encrypted devices to communicate and if they had a leader, it would probably be Leandra English. After all, she was sending emails to the CFPB staff, as if she was in charge until the court’s ruling. In that regard, English has been leading a mini-resistance in her own right by simply ignoring Mulvaney’s emails that simply state she should stop carrying herself as if she is the acting director. She has not responded to them (via The National Law Journal) [emphasis mine]:

Mulvaney and English’s competing claims to be the rightful acting director have made for an awkward situation at the CFPB. In remarks with reporters Monday, Mulvaney acknowledged as much, saying “it’s always a challenge when you’re in a workplace with someone who’s suing you—and I’m a named defendant—to sort of chat around the water cooler.”

Mulvaney said he has sent English “roughly a half a dozen” emails urging her to stop purporting to be the agency’s acting director and asking her to carry out duties customarily performed by a deputy director. “I have heard no response to either of those types of emails,” he said.

The resistance movement within the CFPB has caught the eye of some in Congress. Rep. Dennis Ross (R-FL), who sits on the House Committee on Financial Services, which has oversight over the CFPB, recently sent a letter to Mr. Mulvaney noting his concerns about this rebel group's reported actions, citing The New York Times' story about these disgruntled staffers, specifically how these clowns could be “engaging in fantasy play on the public dime.” Moreover, Congressman Ross voiced his concern about the apparent lawlessness that has engulfed the agency. 

“As public servants, CFPB employees must act in a good-faith, transparent manner, rather than attempt to hide their work in some cloak of invisibility,” he wrote. “Mr. Director, I want to assure you that you have my full support as you work to establish order at the bureau.”

As we said before, if you feel you cannot serve a new administration in government service, it's time to resign and find something else. 

 To rehash the law regarding this area, let’s circle back to Andrew McCarthy at National Review:

The lawsuit seeking to block this appointment, filed by the CFPB’s deputy director Leandra English — who hopes to take the job herself — is frivolous and offensive...Cordray was quite explicitly attempting to ensure that he, rather than the president, would choose his successor. Under the aforementioned CFPB statute, the deputy director serves as the director “in the absence or unavailability of the director.” Cordray was paving the way for English to argue that his resignation as director creates an “absence or unavailability” that makes her the director as a matter of law.

This is an absurdly strained reading of the statute. What Cordray has created is a vacancy. He is not merely absent or unavailable in the commonsense, temporary understanding of these words; he is gone...Although its progressive champions tout it as “independent,” the CFPB statute explicitly establishes it as an “Executive agency” as that term is defined by federal law. (The definition, in section 105 of Title 5, U.S. Code, includes “independent establishment[s].”) Under the so-called Vacancies Act (i.e., the Federal Vacancies Reform Act of 1998), “if an officer of an Executive agency... whose appointment to the office is required to be made by the President, by and with the advice and consent of the Senate, ... resigns,” the president has the authority to name as acting director a currently serving federal officer who has been confirmed by the Senate.

The National Law Journal noted that the next legal chapter to this tale comes down on December 18 when the Department of Justice responds to English’s injunction filing; a hearing is set for December 22. English’s legal team is trying to say that that succession language in Dodd-Frank allows her to assume the acting director role because of Cordray’s absence. This is exactly what McCarthy tore apart in his piece, however. It’s not a temporary absence. This merry-go-round will continue and we’ll keep you updated.