Justice Dept. Takes Stance Against Consumer Bureau

In Governing and the Cabinet On

The Justice Department on Friday took the rare step of opposing another federal agency, the Consumer Financial Protection Bureau, in court, arguing that the bureau’s structure is unconstitutional and should be changed.

But the department’s argument, laid out in a brief filed in a lawsuit brought against the consumer agency, stopped short of endorsing the solution urged by the plaintiff in the case: shutting the bureau down entirely.

The brief, highly anticipated by consumer advocates and financial services companies, opens a window into the Trump administration’s view of the consumer bureau. Created in the aftermath of the 2008 financial crisis, the agency is a frequent target of the wrath of some Republican lawmakers, who would like to see the bureau curtailed or abolished altogether.

The Justice Department brief was filed as part of continuing litigation between the PHH Corporation, a mortgage lender, and the consumer bureau, which in 2015 levied a $109 million fine against the company over what the agency said were illegal kickbacks. PHH filed an appeal, challenging the bureau’s statutory authority to impose the penalty.

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