Former CFPB Director Reveals How Close He Came to Being Fired On Eve of Supreme Court Hearing

As the Supreme Court gets set to hear arguments into the constitutionality of the leadership structure of the Consumer Financial Protection Bureau this week, former director Richard Cordray said in his recently published book that he believes the reason he received an unscheduled phone call he took from the White House — which was abruptly terminated — was to fire him.

Saying he “dodged a bullet,” likely due to the intervention of former Chief of Staff John Kelly, Cordray said he had already been taking precautionary steps in case President Trump did fire him. That included preparing a lawsuit to contest the firing and asking former President Obama for a letter attesting to Cordray’s fitness as director of the CFPB.

Tomorrow, the Supreme Court will hear arguments in the case of Seila Law v. CFPB. The case seeks to determine the legality of the CFPB’s leadership structure — a single director who can only be fired for cause. If the Supreme Court determines the structure is not legal, the question then becomes what to do — whether to change the structure so that the director can be fired for any reason, or whether the CFPB itself needs to be dismantled.

The CFPB issued Seila Law a Civil Investigative Demand letter seeking answers to seven interrogatories and four requests for documents. Seila Law refused to provide the information, leading the CFPB to file a petition with a District Court, which sided with the regulator. Seila Law appealed that ruling to the Ninth Circuit, which also sided with the CFPB. Seila then appealed the ruling to the Supreme Court.

Seila Law is seeking to have the Supreme Court invalidate the entire section of the Dodd-Frank Wall Street Reform and Consumer Protection Act which created the CFPB.

The CFPB has been a political ping-pong ball since it was created nearly a decade ago. back then, as Cordray details in his book, Republican lawmakers were out for blood and made no secret of their disdain for him and the agency he ran. Now, it is up to the Supreme Court to determine the shape — and future — of the CFPB.

How the Supreme Court will answer the question about the CFPB’s leadership structure is anyone’s guess at this point. It’s opinion in the case is expected to be released in June.

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