The Consumer Financial Protection Bureau survived a constitutional challenge and will remain in business, though a federal appeals court took away power from its director and tossed out a $109 million penalty against a mortgage company.


The CFPB also overrode an earlier determination that only conduct committed within the last three years could be subject to punishment, stretching the look-back time to 2008, according to the mortgage company. The bureau then used its own formula to determine the penalty against the mortgage company, boosting the original $6.4 million fine to more than $109 million.

U.S. Circuit Judge Brett Kavanaugh, who wrote the appeals court's primary opinion, said the CFPB erred in retroactively applying the law, violating "the bedrock due process principle that the people should have fair notice of what conduct is prohibited."

Kavanaugh referred to the CFPB's directorship as "the single most powerful official in the entire U.S. government other than the president." He derided the bureau's position that it could pursue an enforcement action for an indefinite time after an alleged violation as "an absurdity."

-- And here's a big compilation of background on the case from Inman news...

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