Industry NewsMortgage

CFPB seeks rehearing in PHH case that declared it unconstitutional

Bureau says three-year RESPA battle with mortgage lender could be ‘the most important separation of powers case in a generation’
  • The CFPB called the appeals court’s Oct. 11 ruling -- considered to be a huge win for embattled PHH -- “dramatic and unprecedented."
  • The CFPB’s petition also claimed the court “misinterpreted RESPA.”
  • The rehearing request asks that the case be heard again in front of all the court's judges instead of a panel of three.

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As the Consumer Financial Protection Bureau’s (CFPB) battle with mortgage lender PHH Corp. enters its third year, the bureau is striking back against a recent federal court’s finding that its single-director structure is “unconstitutional” and challenging the court’s interpretation of the Real Estate Settlement Procedures Act (RESPA). On Nov. 18, the CFPB filed a strongly worded petition for a rehearing en banc with the U.S. Court of Appeals for the District of Columbia, asking the court to reconsider its declaration last month that “the single-director structure of the CFPB represents a gross departure from settled historical practice.” The CFPB called the court’s Oct. 11 ruling -- considered to be a huge win for embattled PHH -- “a dramatic and unprecedented ruling that purports to override Congress’ explicit determination to create ‘an independent bureau’ to exercise regulatory and law enforcement authority in a particular segment of the economy. ...