Attorney General Ken Paxton expressed his hope that the U.S. Court of Appeals for the 5th Circuit will strike down the structure of the federal Consumer Financial Protection Bureau (CFPB) as unconstitutional after hearing arguments today in the case. Last July, he filed a friend-of-the-court brief with the 5th Circuit as the leader of a 14-state coalition challenging the CFPB’s constitutionality.
“The CFPB has so much power and so little accountability, it operates like a branch of the government unto itself, violating the Constitution’s separation of powers and stifling economic growth through overregulation in the process,” Attorney General Paxton said. “It was set up so that its unelected director enjoys more unilateral authority than anyone else in the U.S. government, arguably even more than the President. Ultimately, a ruling by the 5th Circuit that the CFPB is unconstitutional will return control to the people, through their duly-elected representatives in Congress.”
Last year, the D.C. Circuit Court of Appeals ruled that the CFPB’s structure was constitutional, but the U.S. District Court for the Southern District of New York reached the opposite conclusion last month. The coalition of states is asking the 5th Circuit to disagree with the D.C. Circuit’s decision.
Attorney General Paxton was joined on his friend-of-the-court brief with the 5th Circuit by his counterparts from Arkansas, Georgia, Indiana, Kansas, Louisiana, Michigan, Nebraska, Oklahoma, South Carolina, Tennessee, Utah, and West Virginia along with former Maine Governor Paul R. LePage.
Texas originally challenged the constitutionality of the CFPB and its Arbitration Rule in October 2017, filing a multistate coalition brief with the U.S. District Court for the Northern District of Texas. A month later, President Trump and Congress rescinded the rule. Attorney General Paxton also led a coalition of states with several friend-of-the-court briefs supporting the president’s authority to appoint an acting CFPB director.