This is an update to our original post: The CFPB's Proposed Arbitration Rules–Dead or Alive? on June 1, 2017.
It is official: The CFPB's arbitration rule is dead. On October 24, the Senate passed its resolution to disapprove the CFPB's rule by a 51-50 vote. Interestingly, Vice President Mike Pence cast the tie-breaking vote. On November 1, President Trump signed the joint resolution, officially killing the CFPB's rule.
Going forward, the CFPB is now prohibited from writing a substantially similar rule without specific authorization from Congress. Following the vote, Richard Cordray said: "Tonight's vote is a giant setback for every consumer in this country…." Further, on November 24 Richard Cordray resigned from his position as Director of the CFPB.
Many believed Richard Cordray had a history of overstepping his authority in overseeing banks, credit unions, and other financial service providers. In his place, President Trump named his White House OMB director, Mick Mulvaney, to serve as the replacement Director of the CFPB. After a brief federal hearing challenging his appointment, Mick Mulvaney remains the current Director of the CFPB.
Hold on to your hats because the future of the CFPB will certainly be a wild ride, especially given that Mick Mulvaney had once called the CFPB a "joke" in a "sick, sad kind of way." Further, in his first press conference acting as Director of the CFPB, Mr. Mulvaney went on to describe the CFPB as an "awful example of a bureaucracy that has gone wrong." The CFPB will keep its doors open for now, but we will surely see some Trump-style transitioning and interpretation in the near future.
