News & Press: Newswire

Judges Question CFPB on Constitutionality of its Structure

Wednesday, April 13, 2016   (0 Comments)
Posted by: Sharon Edmondson
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Federal appeals court judges today questioned a Consumer Financial Protection Bureau lawyer over whether the agency's structure violated the Constitution and whether it should be run by a commission.

The case at issue is a ruling made last year by CFPB Director Richard Cordray ordering mortgage lender PHH Corp. to return $109 million, which is all of the reinsurance premiums the company received from mortgage insurers as part of a kickback on the home loans it offered since 2008. Cordray went beyond an administrative law judge's previous ruling in the case, which was the first appeal by the bureau. A lawyer for PHH argued the bureau ignored a statute of limitations in the case, overturned past regulatory guidance the company thought it was following, and did not give warning to the firm - all could have effects on future cases brought by the bureau.


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