Monday, November 27, 2017

What did Donald Trump do today?

He stopped restitution payments made to victims of financial crimes.

Last week, Trump tried to appoint his budget director, Mick Mulvaney, as the acting director of the Consumer Financial Protection Bureau (CFPB). This may not have been legal: the agency already has an acting director, Leandra English, who was put into the line of succession by former director Richard Cordray when he retired. English filed a suit in federal court yesterday to resolve the dispute.

Mulvaney shares Trump's open hostility to the agency, which is responsible for enforcing consumer protection laws in the financial industry. (Much of Trump's resentment of the agency comes from the fact that it was created by Sen. Elizabeth Warren, a frequent Trump critic who has proved especially adept at provoking him.) 

On arriving at the Bureau, Mulvaney's first act was to stop payments from the Civil Penalty Fund (CPF). The CPF uses money already collected from fines and penalties from law-breaking institutions to compensate the victims of those crimes. People currently receiving compensation through the CPF include victims of fraudulent student loan counseling, mortgage financing scams, and predatory debt-relief programs. Neither Mulvaney nor the Trump administration offered any rationale for stopping the restitution payments.

English's request for a temporary restraining order barring Mulvaney's appointment may well be granted in the coming days, but Trump is likely to get what he wants from the resulting confusion anyway. Because the CFPB's legal authority rests on a properly appointed acting director, the agency is not expected to be able to enforce financial laws while the dispute lasts.

Why should I care about this?

  • It's bad if presidents deliberately sow chaos in their own government.
  • The victims of crimes should not be denied restitution just to make a political point.