Richard Cordray, the Director of the CFPB since 2013, resigned at the end of the day on Friday, November 24, 2017, a week earlier than expected. That same day, Cordray also appointed Leandra English, the CFPB's chief of staff, to serve as the agency's Deputy Director. David Silberman had previously been serving as Acting Deputy Director. (The only politically appointed post at the Bureau is the Director of the agency). Hours after Mr. Cordray's announcement, the White House appointed Mick Mulvaney, the Director of the Office of Management and Budget, acting director of the CFPB. The Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (CFPA) states that the Deputy Director "shall serve as acting Director in the absence or unavailability of the Director," codified at 12 U.S.C. § 5491 (b)(5)(B).
The issue is whether this provision can be interpreted consistently with the Federal Vacancies Reform Act (FVRA), which generally allows the President to appoint an official to serve in an acting capacity – specifically, whether the exclusivity provision of the FVRA, 5 U.S.C. § 3347, and the CFPA preclude a vacancy appointment by expressly "designat[ing] an officer or employee to perform the functions and duties of a specified office temporarily in an acting capacity."
Late Sunday evening, Leandra English filed an emergency Temporary Restraining Order and Civil Complaint seeking to stop the Trump Administration from appointing Mr. Mulvaney as the Acting Director and seeking a declaratory judgment that she is the proper Acting Director. In large part, her suit relies on the above-cited provision of the CFPA.
In addition, Mary McLeod, the CFPB's General Counsel, released a memorandum (available here) to CFPB staff alerting them to the need to recognize the President's right to appoint Mulvaney and to act accordingly. According to other reports, Ms. English and Mr. Mulvaney have each sent "all hands" emails establishing their service as the agency's new Acting Director. In addition, Mr. Mulvaney's email says "please disregard any instructions you receive from Ms. English in her presumed capacity as Acting Director."
The controversy over the CFPB's leadership comes as the Bureau faces challenges on legislative and judicial fronts, with congressional opposition to CFPB rulemaking under the Congressional Review Act, and a pending decision regarding the CFPB's constitutionality in the D.C. Circuit. It is likely that Mulvaney, as the Acting Director chosen by the Administration, would seek to review and slow the pace of the CFPB's rulemaking and do the same for its enforcement actions. The CFPB has had many "firsts" since it was created, and we will be following closely how it handles its first change in leadership.