The Consumer Financial Protection Bureau on Wednesday defended its authority to request records about a company from state regulators even as a federal appeals court blocks an agency subpoena demanding records from the targeted business.
In a court filing earlier this month, pension advance provider Future Income Payments said the CFPB was demanding information from state authorities that the company provided generally under confidentiality restrictions. The California-based firm, which provides consumers with lump sum payments in exchange for all or a portion of their future pensions, said the CFPB was seeking confidential and sensitive information in spite of a ruling by the U.S. Court of Appeals for the Ninth Circuit that stayed a federal district judge s decision ordering Future Income Payments to respond to the bureau s subpoena.
The company s latest brief, filed Aug. 2 in separate litigation before the U.S. District Court for the District of Columbia, said the CFPB knew Future Income Payments voluntarily produced sensitive and confidential information to various state agencies typically under an explicit confidentiality agreement or under the protection of state law as part of its cooperation with those agencies investigations. The CFPB, according to the brief, sought records from at least one agency: the North Carolina Department of Justice.
Future Income Payments represented by Dorsey & Whitney and Womble Carlyle Sandridge & Rice did not explicitly criticize the agency s continued investigative efforts as improper. Instead, it sought to make the case for allowing the company to contest the constitutionality of the CFPB s independent, single-director structure in a Washington, D.C., federal district court, where the bureau has argued it should be precluded from seeking to relitigate the very same issue it raised fighting the subpoena in the U.S. District Court for the Central District of California.
For the CFPB, the subtext of Future Income Payments brief was clear. In a footnote on the final page of its response Wednesday, the CFPB said Future Income Payments implies that it would be somehow inappropriate for the bureau to gather information about the company from other regulators in light of the Ninth Circuit s stay.
[Future Income Payments] is mistaken, wrote the CFPB s general counsel, Mary McLeod, and two other attorneys in her office. The Ninth Circuit did not stay any action by the bureau. Rather, the Ninth Circuit stayed but did not vacate or otherwise disturb the district court s order that FIP produce documents and other information to the bureau.