On Monday, The Supreme Court ruled that the structure of the Consumer Financial Protection Bureau is unconstitutional. This may result in a wave of new legal challenges to regulations and enforcement actions previously enforced by the organization.

The agency may therefore continue to operate, but its Director, in light of our decision, must be removable by the President at will.

In a 5-4 decision, the court ruled that the director of the CFPB must be fireable at will by the president in an attempt to prevent the agency from infringing on the separation of powers between legislative and executive branches.

Although the decision does not dismantle the financial regulator, it does answer some questions that had followed the Obama-era bureau. All those who followed the progress largely agreed that the decision would do little to curb the CFPB’s immense power, on both the conservative and progressive sides.

In 2010, the Dodd-Frank Act created the CFPB as an agency to be controlled by a single director who held unilateral control over the regulatory and enforcement decisions. This director would serve a five-year term and, until Monday, could only be fired for severe neglect or misconduct.

Joined by his conservative colleagues, Chief Justice John Roberts wrote in the majority decision, "The agency may therefore continue to operate, but its Director, in light of our decision, must be removable by the President at will."

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Originally posted on F&I and Showroom

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