WASHINGTON – A group of Republican state attorneys general has declined to sign cooperation agreements with the Consumer Financial Protection Bureau, part of a Republican revolt against the agency that began with GOP lawmakers in Congress.
Richard Cordray, the CFPB’s director, in March asked all 50 states to sign a memorandum of understanding designed to protect confidential information shared among states and the bureau. To date, only 12 states – all but one with Democratic attorneys general – have signed, according to the bureau.
Oklahoma Attorney General Scott Pruitt said he is declining to sign the agreement because of legal objections to the law that created the consumer bureau, the 2010 Dodd-Frank Act.
Four attorneys general, led by Pruitt, plan to join an existing lawsuit that challenges the constitutionality of Dodd- Frank and the CFPB. Pruitt and attorneys general from South Carolina, Michigan and Kansas may become plaintiffs in the suit as soon as today.
The lawsuit in federal court in Washington was filed June 21 by State National Bank of Big Spring, Texas. The suit argues the structure of the consumer bureau violates the constitutional principle of separation of powers because Congress does not appropriate its budget, the president has limited ability to remove its director and courts face restrictions in reviewing its actions.
South Carolina Attorney General Alan Wilson last week told a campaign rally in Greenville, S.C., of plans for legal action. “We’re going to challenge that law,” Wilson said on Sept. 14. “We’re going take the battle back to Washington, D.C., because community banks on Main Street shouldn’t be choked to death so that big banks on Wall Street can take our money.”