(MENAFN- Gulf Times) US President Donald Trump has criticised the US Consumer Financial Protection Bureau (CFPB) after he appointed a new interim head a day earlier.
'The Consumer Financial Protection Bureau, or CFPB, has been a total disaster as run by the previous administrations pick, Trump posted on Twitter. 'Financial Institutions have been devastated and unable to properly serve the public, he added.
The White House defended Trump's choice on Saturday. 'We think that this move is clearly supported by a plain reading of the Vacancies' Act, a senior administration official said on a call with reporters, CNN reported.
On Friday, Trump had named Mick Mulvaney, the White House budget director, as the interim director of the agency.
Hours earlier the agency's outgoing director Richard Cordray had tapped his deputy director, Leandra English, to fill the position, according to CNN.
Democratic US Senator Elizabeth Warren of Massachusetts criticised Trump for naming an interim director.
If there is a vacancy the deputy would become the new director, Warren asserted on Twitter, citing the Dodd-Frank Act, the legislation enacted after the 2008 financial crisis designed to protect American consumers. The courts should now decide the matter, she posted on Twitter.
The agency, which was founded in 2011, oversees US Federal financial laws that protect consumers.
The White House's plan to appoint an interim leader for the top US regulator for consumer finance came under further scrutiny yesterday as a senior Democratic senator said the move would violate the Dodd-Frank Wall Street reform law.
Richard Cordray, a Democrat, stepped down on Friday as director of the Consumer Financial Protection Bureau, which was created after the financial crisis to protect consumers from abusive lending practices.
He named Leandra English, the agency's chief of staff, as deputy director and said she would take over as acting director.
President Donald Trump then named White House budget director Mick Mulvaney, one of the CFPB's fiercest critics, to the position.
On Saturday, the Justice Department said in a memo that the White House was right to name an interim CFPB director.
Dick Durbin, the US Senate's No 2 Democrat, told CNN's State of the Union yesterday that he did not believe the Trump administration had the authority to appoint Mulvaney under the 2010 Dodd-Frank law, which created the agency.
'I read the provision, Durbin said. 'It says that when the director steps aside, the deputy director shall be in charge of the agency — not may — shall be in charge, and so now there's an effort by Mick Mulvaney and the attorney general to really push him into this position so he can take away their power.
Both sides agree that Trump may nominate a permanent CFPB director, but that appointment might not happen for months because it requires Senate approval.
The CFPB, the brainchild of Senator Elizabeth Warren, a Democrat, has long been in the crosshairs of Republicans, who say it has had too much unchecked power.
According to the Department of Justice memo, the Dodd-Frank language about changing CFPB directors is 'unusual but the White House may name an interim chief. Such advice is open to legal challenge.
Administration officials say the 1998 Federal Vacancies Reform Act gives the president the power to temporarily fill agency positions, except for those with multimember boards — an exemption they said did not apply to the CFPB.
Republican Senator Lindsey Graham, also on State of the Union, disputed the notion that the White House lacked authority.
'I think the president's on good ground here to appoint somebody under the vacancy statute, Graham said.
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