Leading a coalition of 12 states, Attorney General Ken Paxton today filed a friend-of-the-court brief with the U.S. District Court for the Northern District of Texas challenging the constitutionality of the Consumer Financial Protection Bureau (CFPB) and its Arbitration Rule. The U.S. Chamber of Commerce, along with several Texas-based business organizations, sued the CFPB to block the rule from taking effect.
“The CFPB may be the most powerful, least accountable agency in American history, and because it was unlawfully constituted, it has no rule-making authority,” Attorney General Paxton said. “One federal court already has recognized that the CFPB’s unelected director enjoys more unilateral authority than anyone else in the U.S. government, other than the president. The Constitution does not permit an executive agency to aggregate that much unchecked power in a single person.”
The CFPB’s Arbitration Rule would prohibit consumers and providers of financial products and services from agreeing to resolve future disputes through arbitration, even though arbitration gives consumers the ability to bring claims that they could not realistically assert in court.
In July, the U.S. House voted to overturn the Arbitration Rule, and the U.S. Senate on Tuesday voted to do the same. The measure is now awaiting President Trump’s signature.
“We hope the president will soon take action to do away with the Arbitration Rule, which is bad for business and hurts consumers by giving them fewer options for quickly and efficiently resolving financial disputes,” Attorney General Paxton said. “The CFPB itself is unconstitutional, unanswerable to anyone, and should be done away with.”
Attorney General Paxton is joined on the amicus brief by his counterparts from Alabama, Georgia, Indiana, Louisiana, Michigan, Missouri, Nevada, Oklahoma, South Carolina, Utah and Wisconsin.
View the amicus brief here: http://bit.ly/2yNnVvV