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Consumer watchdog director agrees White House could remove her without cause

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Consumer watchdog director agrees White House could remove her without cause

The head of the Consumer Financial Protection Bureau has said a president should be able to remove its director without cause, reigniting an old debate dating back to the conception of the agency nine years ago.

Currently, a president is only able to remove the agency's director with cause. CFPB Director Kathy Kraninger wrote in a Sept. 17 letter to congressional leadership that she believes the president's inability to remove a director of the bureau at his discretion is unlawful.

"Mindful of the Bureau's role as an executive agency within the executive branch ... I have decided that the bureau should adopt the Department of Justice's view that the for-cause removal provision is unconstitutional," Kraninger wrote.

The letter to House Speaker Nancy Pelosi, D-Calif., and Senate Majority Leader Mitch McConnell, R-Ky., follows a brief filed the same day by the Department of Justice to the Supreme Court asking it to consider a case allowing the president to remove the director from power.

The brief argues that the insulated nature of the agency, laid out in the Dodd-Frank Act, is unlawful because the bureau is not accountable to the executive branch, as the president cannot fire a director. A lower court ruled in 2018 that the bureau's leadership structure is constitutional because other independent agencies, such as the Federal Trade Commission, are similarly structured.

In Kraninger's letter to congressional leadership, the director wrote that there is a "conflict" between what Congress enacted in 2010 and "the President's understanding of his authority under Article II of the Constitution."

Kraninger also wrote that her position does not affect her day-to-day duties of leading the agency and that if the high court decides to take the case, the agency will "appoint an experienced advocate" to defend her and the Justice Department's position.