Speaking at the MBA secondary conference, CFPB Director Rohit Chopra pushed back against the argument that credit reporting fees are distinct from junk fees. He said the term junk fee extends to fees that lack competition in the market.
“The dynamics with the [CFPB] will now start to resemble those of most federal agencies: there will be legal challenges to specific regulations and enforcement actions … but those will be focused, targeted challenges, not existential ones,” according to Adam Levitin, a Georgetown University law school professor.
The Mortgage Bankers Association said a constitutional loss would have invalidated the bureau’s previous rules and caused severe consequences for single-family and multifamily mortgage markets.
The 7-2 court opinion, delivered by Justice Clarence Thomas, affirmed the constitutionality of the CFPB’s funding structure. The court dismissed arguments that the funding mechanism lacks a time limit and a spending cap.
The Supreme Court ruling in favor of the CFPB means lawsuits against the bureau will now focus on specific issues. It also paves the way for implementation of various pending rules.