Fannie Mae-No Politics (FNMA)

[Robert from yahoo bd]

Theres a split circuit opinion here (DC Circuit ruled that CFPB does not violate the appropriations claim)

I believe that the DC CIRCUIT opinion that you are referring to is PHH v CFPB:

https://casetext.com/case/phh-corp-v-consumer-fin-prot-bureau-3

Notice that the PHH decision was NOT addressing the Appropriations Clause but another Seperation of Powers constitutional issue, which was subsequently overturned by Seila Law:

"Today, we hold that federal law providing the Director of the CFPB with a five-year term in office, subject to removal by the President only for "inefficiency, neglect of duty, or malfeasance in office," is consistent with the President's constitutional authority."

"Further action by the CFPB necessitates a decision on the constitutionality of the Director's for-cause removal protection. We accordingly decide only that constitutional question. "

"Our analysis focuses on whether Congress's choice to include a for-cause removal provision impedes the President's ability to fulfill his constitutional role."

"These examples typify other federal financial regulators, such as the Commodity Futures Trading Commission, the Federal Deposit Insurance Corporation, the Federal Housing Finance Authority, the National Credit Union Administration, and the Securities and Exchange Commission, which are considered independent whether or not for-cause removal protection is specified by statute. See Henry B. Hogue et al., Cong. Research Serv., R43391, Independence of Federal Financial Regulators: Structure, Funding, and Other Issues 1, 15 (2017). This makes sense because Congress has consistently deemed "insulation from political concerns" to be "advantageous in cases where it is desirable for agencies to make decisions that are unpopular in the short run but beneficial in the long run," such as, for example, "the Fed's monetary policy decisions." Id. at 5 n.16. History and tradition, as well as precedent, show that Congress may appropriately give some limited independence to certain financial regulators."

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As I stated earlier the 5th Circuit Appealate Panel is the only one so far to dig deep into the Appropriations Clause issue, from the 5th Circuit Appealate Panel CFPB decision:

"The Bureau also contends that because every court to consider its
funding structure has deemed it constitutionally sound, we should too.15

"Footnote 15: See, e.g., PHH Corp., 881 F.3d at 95–96; CFPB v. Citizens Bank, N.A., 504 F.

Supp. 3d 39, 57 (D.R.I. 2020); CFPB v. Fair Collections & Outsourcing, Inc., No. 8:19-cv-

2817, 2020 WL 7043847, at *7-9 (D. Md. Nov. 30, 2020); CFPB v. Think Finance LLC, No.
17-cv-127, 2018 WL 3707911, at *1-2 (D. Mont. Aug. 3, 2018); CFPB v. Navient Corp., No.
3:17-cv-101, 2017 WL 3380530, at *16 (M.D. Pa. Aug. 4, 2017); CFPB v. ITT Educ. Services,
Inc., 219 F. Supp. 3d 878, 896-97 (S.D. Ind. 2015); CFPBv. Morgan Drexen, Inc., 60 F. Supp.
3d 1082, 1089 (C.D. Cal. 2014)."

"the Comptroller of the Currency, the National Credit Union Administration,
and the Federal Housing Finance Agency all have complete, uncapped
budgetary autonomy.” PHH Corp., 881 F.3d at 95.
Such a comparison, focused only on whether other agencies possess a
degree of budgetary autonomy, mixes apples with oranges. Or, more
accurately, with a grapefruit. Even among self-funded agencies, the Bureau
is unique. The Bureau’s perpetual self-directed, double-insulated funding
structure goes a significant step further than that enjoyed by the other
agencies on offer. And none of the agencies cited above “wields enforcement
or regulatory authority remotely comparable to the authority the [Bureau]
may exercise throughout the economy.” All Am. Check Cashing, 33 F.4th at
237 (Jones, J., concurring); see also William Simpson, Above Reproach: How
the Consumer Financial Protection Bureau Escapes Constitutional Checks &
Balances, 36 Rev. Banking & Fin. L. 343, 367–69 (2016).16 Taken
together, the Bureau’s express insulation from congressional budgetary
review, single Director answerable to the President, and plenary regulatory
authority combine to render the Bureau “an innovation with no foothold in history or tradition.” Seila Law, 140 S. Ct. at 2202. It is thus no surprise that
the Bureau “brought to the forefront the subject of agency self-funding, a
topic previously relegated to passing scholarly references rather than front-
page news.” Charles Kruly, Self-Funding and Agency Independence, 81 Geo.
Wash. L. Rev. 1733, 1735 (2013).
We cannot sum up better than Judge Jones did:
[T]he [Bureau]’s argument for upholding its funding
mechanism admits no limiting principle. Indeed, if the
[Bureau]’s funding mechanism is constitutional, then what
would stop Congress from similarly divorcing other agencies
from the hurly burly of the appropriations process? . . . [T]he
general threat to the Constitution’s separation of powers and
the particular threat to Congress’s supremacy over fiscal
matters are obvious. Congress may no more lawfully chip away
at its own obligation to regularly appropriate money than it may
abdicate that obligation entirely. If the [Bureau]’s funding
mechanism survives this litigation, the camel’s nose is in the
tent. When conditions are right, the rest will follow.
All Am. Check Cashing, 33 F.4th at 241 (Jones, J., concurring). The Bureau’s
funding apparatus cannot be reconciled with the Appropriations Clause and
the clause’s underpinning, the constitutional separation of powers.
3.
That leaves the question of remedy. "

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Can you think of a single case in another federal circuit that directly decides whether or not the CFPB's funding mechanism does not violate the Appropriations Clause?