The Supreme Court agreed to review a challenge to the constitutionality of the Consumer Financial Protection Bureau’s (CFPB) authority. Plaintiff, Sheila Law LLC, is arguing that a legal provision stipulating that the director can only be removed by the President for cause violates the constitutional separation of powers. The CFPB director, like the Federal Housing Finance Agency (FHFA) director, serves in a five-year role and cannot be fired at will. The Supreme Court’s decision will have implications for both the CFPB and FHFA.

CFPB Director Kathy Kraninger decided last month that the agency would no longer defend its leadership structure as constitutional, and the Trump administration filed a brief with the court reflecting that position.

In 2017, the Trump Administration named Mick Mulvaney interim director while Leandra English was serving as deputy director. English challenged Mulvaney’s appointment saying a provision in the Dodd-Frank financial reform law specified that the deputy director should step in as interim head. English dropped her lawsuit when President Trump nominated Kathy Kraninger as a permanent director.