Law Offices of Crystal Moroney, P.C. v. Consumer Financial Protection Bureau

The Dodd-Frank Wall Street Reform and Consumer Protection Act, Pub. L. No. 111-203 (2010), created the Consumer Financial Protection Bureau (CFPB or Bureau) to serve as “an independent financial regulator” responsible for “implementing and enforcing a large body of financial consumer protection laws.” Seila Law LLC v. CFPB, 140 S. Ct. 2183, 2193 (2020). Congress structured the Bureau in a manner explicitly designed to insulate CFPB from oversight by future Congresses, particularly with respect to funding. The Act exempts CFPB from reliance on annual appropriations for funding; it authorizes CFPB instead to requisition from the Federal Reserve Board any amount (up to 12% of the Federal Reserve’s total operating expenses) “determined by [CFPB’s] Director to be reasonably necessary to carry out” the Bureau’s functions. 12 U.S.C. § 5497(a). In proceedings below, the Second Circuit held that CFPB’s unique funding structure is consistent with the Constitution’s separation-of-powers principles. The court expressly disagreed with the Fifth Circuit’s contrary holding. Based on its holding, the Second Circuit enforced the Civil Investigative Demand (CID) issued by CFPB to Petitioner. The Question Presented is as follows: Whether the Consumer Financial Protection Agency’s funding structure—which imposes no meaningful constraints on the authority of the President or CFPB to choose the Bureau’s amount of annual public funding—violates the Appropriations Clause, U.S. Const. Art. I, Sec. 9, Cl. 7, and renders unenforceable the CID issued in this case.