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Mulvaney appears to have the upper hand in CFPB struggle

Ethan Wolff-Mann
Senior Writer

On Monday morning, Mick Mulvaney, the Office of Management and Budget (OMB) director, and Leandra English, the newly appointed deputy director of the Consumer Financial Protection Bureau (CFPB), claimed to start their first day as head of the agency. Former CFPB Director Richard Cordray stepped down from the top post Nov. 24.

While both Mulvaney and English sent emails to the staff signed “acting director,” it appears that Mulvaney, who arrived at the bureau with doughnuts in tow, has the upper hand and is being treated as acting director.

Office of Management and Budget Director Mick Mulvaney leaves the Consumer Financial Protection Bureau (CFPB) building after a meeting in downtown Washington D.C., U.S. November 27, 2017. REUTERS/Carlos Barria

In a clear sign, a CFPB spokesperson directed a Yahoo Finance email inquiry to an OMB spokesperson. The spokesperson, John Czwartacki, told Yahoo Finance, “Mick is acting director. I’ve seen nobody treat him otherwise inside the building.”

Though it’s remotely possible Mulvaney may simply have control over the communications channels alone — a common tactic in military coups, which often storm the television news — the Trump appointee was seen sitting in the director’s office on Twitter and was reported to lead meetings on Sunday and Monday.

In Mulvaney’s corner is also the word of the CFPB general counsel, Mary McLeod, who said she agreed with the Trump administration.

However, English, who claims to have the law on her side, sued Mulvaney and President Donald Trump to block the former from taking over the consumer protection agency.

According to Bloomberg, CFPB workers are relying on the general counsel’s opinion, but the tone is of confusion.

‘Fox in the henhouse’

Consumer advocates are concerned about Mulvaney taking over an agency he once worked to eliminate as a member of Congress, and that he would gut the CFPB and put the interests of financial institutions above those of ordinary consumers. Sen. Chuck Schumer (D-NY) referred to him as a “fox in the henhouse” if he were to lead the CFPB.

Should the legal challenge tie up the agency in a quagmire, Mulvaney and the Trump administration could count that as a win, as a confused and crippled CFPB may effectively do nothing, an outcome that could be tantamount to the CFPB’s dissolution.

In the end, the way out of this tangle will be a fresh director, appointed by the president and confirmed by the Senate, a process that could take months. However, some financial services trade groups still want the CFPB to abandon its one-director structure in favor of a five-person commission, similar to the Federal Communications Commission and other government agencies.

“The CFPB’s current governing structure is a dictatorship, period,” said the Consumer Bankers Association CEO and President Richard Hunt in a statement. “It is well past time for the administration and Congress to provide a balanced, responsible and transparent approach to consumer protection and establish a Senate-confirmed, bipartisan commission at the CFPB.”

Ethan Wolff-Mann is a writer at Yahoo Finance. Follow him on Twitter @ewolffmann. Confidential tip line: FinanceTips[at]oath[.com].

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