Days after Team Obama celebrated the fifth anniversary of Dodd-Frank, a federal appeals court has revived a challenge to one of the financial law’s most controversial creations. . . .
On Friday a unanimous three-judge panel of the D.C. Circuit Court of Appeals ruled that State National Bank of Big Spring has standing to challenge the [Consumer Financial Protection Bureau’s] constitutionality. In reversing a lower court decision, the appellate judges also ruled that the small Texas bank has standing to challenge the 2012 appointment of the bureau’s director, Richard Cordray. . . .
The bank, supported by a legal team including former White House counsel Boyden Gray and the Competitive Enterprise Institute, argues that the agency violates the Constitution’s separation of powers. The bureau is an independent agency and thus largely unaccountable to the President. But because it draws funding directly from the Federal Reserve, rather than appropriations, it is also largely unaccountable to Congress. And it can declare lending practices abusive at whim. Don’t be surpised if this is another case that makes it to the Supreme Court.