On January 4, President Obama appointed former Ohio Attorney General Richard Cordray as Director of the Consumer Financial Protection Bureau (the CFPB). The appointment was made without Senate approval while "in recess," even though the Senate had not been in recess for more than three business days, the long-accepted standard of what constitutes a recess. Republican senators, who had vowed to block the confirmation of any CFPB director unless the bureau’s structure and funding are changed, had been holding pro forma sessions to prevent such an appointment. It is expected that the President’s action will spur a legal challenge based on the President’s alleged disregard of the “advice and consent” requirements for his nominees. American Bankers Association president, Frank Keating, was critical of the appointment, stating, “The controversial nature of [the] recess appointment reinforces the banking industry’s concerns about the bureau’s structure and lack of accountability. It puts the bureau’s future actions in constitutional jeopardy, threatening its work, complicating compliance efforts of banks, and further undermining the entity’s authority and credibility.”
To read the press release, click here.