Independent Agencies

In the last Supreme Court term, the Court ruled in Seila Law LLC v. Consumer Financial Protection Bureau that Article II of the U.S. Constitution and separation of powers prohibit Congress from shielding the Bureau’s director from termination except for cause. More troubling, Seila Law could open up the financial system to destabilization by paving the path for a full-scale assault on the traditional independence of federal financial regulators and presidential manipulation of the economy.

In Seila Law LLC v. Consumer Financial Protection Bureau, the Supreme Court, in an opinion by Chief Justice John Roberts, invalidated the provision of the Dodd-Frank Act restricting the president’s removal of the director of the Consumer Financial Protection Bureau (CFPB) to cases of “inefficiency, neglect of duty, or malfeasance in office.” The Court’s decision leaves the director subject to removal by the president for any reason or no reason at all.