Credit Union Loses Challenge to Trump’s CFPB Director

(CN) – A federal judge ruled that a credit union lacks standing to challenge President Donald Trump’s appointment of Mick Mulvaney, an outspoken critic of the Consumer Financial Protection Bureau, to head the agency.

Taken from a video uploaded by the White House in April 2017, this image shows Mick Mulvaney standing in front of federal regulations he says were created in the last two years. Mulvaney was director of the White House budget at the time but was appointed last November to take over the Consumer Financial Protection Bureau.

Last year, the CFPB underwent a tug-of-war over who had the authority to appoint its director.

Leandra English was appointed to the post by outgoing CFPB Director Richard Cordray when he announced his resignation last November. The Dodd-Frank Wall Street Reform and Consumer Protection Act was used as the basis to make the appointment.

But President Donald Trump appointed White House budget director Mick Mulvaney to the post under a 1988 law called the Federal Vacancies Reform Act.

U.S. District Judge Timothy Kelly settled the issue in late November. In a ruling from the bench, Kelly – a Trump nominee – found the president had the rightful authority to designate Mulvaney as acting director of the CFPB.

One week later, the Lower East Side People’s Federal Credit Union sued Trump, saying his actions have thrown credit unions and banks across the country “into a state of regulatory chaos.”

“Even worse, defendant Trump has purported to appoint an acting director whose mission is to destroy a bureau that protects thousands of the credit union’s members,” the complaint states.

As evidence of this point, the credit union quotes Mulvaney’s description of the CFPB as “a sad, sick joke,” and his 2015 testimony before the House of Representatives.

“I don’t like the fact that CFPB exists, I’ll be perfectly honest with you,” Mulvaney had said.

But U.S. District Judge Paul Gardephe, a George W. Bush appointee in the Southern District of New York, dismissed the credit union’s case Thursday for lack of standing.

“The mere fact that plaintiff is regulated by the CFPB does not confer standing to bring this suit,” Gardephe said.

The possibility that Mulvaney may rewrite CFPB rules in a manner that might harm the credit union’s mission of “improving the financial health of underserved communities” is likewise not enough to confer standing, the judge ruled.

“Plaintiff’s speculation regarding the future actions of third parties is not sufficient to establish an imminent injury,” the 20-page opinion states.

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