Defying Senate, President Obama purportedly makes recess appointment of Cordray to lead CFPB
For nearly six months, President Obama’s nomination of Richard Cordray to be the first Director of the Bureau of Consumer Financial Protection (CFPB) has been blocked by Senate Republicans. Today, the President is attempting to call the Senate’s bluff by making a legally questionable recess appointment of Cordray.
Under Article II, Section 2, Clause 3 of the federal Constitution, the President is empowered to make appointments to fill vacancies while the Senate is in recess. These so-called “recess appointments” have a limited duration, expiring when the next session of Congress ends, so Cordray’s appointment would not be effective for the full five-year term contemplated by the Dodd-Frank Act unless he were renominated by the President and confirmed by the Senate.
There is a real constitutional question whether the Senate is, in fact, in “recess” and whether President Obama’s appointment of Cordray is valid. In attempting to block President Obama from making recess appointments (and, in particular, an appointment of Cordray), the House of Representatives has purported to remain in session, holding “pro forma” sessions every few days in which few members of the House are present and which last literally seconds or minutes. Due to the requirements of Article I, Section 5, Clause 4 of the Constitution, the Senate is unable to adjourn for more than three days without the consent of the House, and the current Republican-controlled House has forced the Democrat-controlled Senate leadership to remain officially in session and to hold similar pro forma sessions every few days.
Much more is at stake than a high-profile leadership appointment for Cordray. Under the Dodd-Frank Act, the CFPB lacks supervisory and enforcement jurisdiction over nondepository institutions until a director is in place. With very few exceptions, Congressional Republicans have never been supporters of Dodd-Frank or, in particular, the CFPB and its broad jurisdiction and consumer protection mandate, and they have used their leverage over the appointment of a director to forcefully advocate for major structural changes in the CFPB.
It now seems likely that Cordray’s recess appointment, as well as attempted supervision and enforcement actions by the CFPB for nondepository institutions, may be challenged soon in federal court. Stay tuned: this saga is far from over.