In an email circulated to IBAT members last Friday, August 4, IBAT President and CEO Christopher Williston announced that IBAT, along with ICBA and Texas First Bank, filed an emergency motion to intervene in the matter of Texas Bankers Association; Rio Bank of McAllen; and American Bankers Association v. Consumer Financial Protection Bureau (CFPB).
IBAT and ICBA’s ultimate goal is to broaden the application of injunctive relief provided to banks, delaying the implementation of final rules implementing Section 1071 of the Dodd-Frank Act until the Supreme Court rules on the constitutionality of the funding mechanism of the CFPB.
“No bank should be on the hook to spend tens of thousands of dollars to implement a rule from an agency funded through unconstitutional means,” Williston said. “Until the validity of the Bureau is established, we have no choice but to stand up for banks everywhere who are negatively affected by the narrowly defined injunctive relief.”
If IBAT and ICBA are successful in this endeavor, almost every bank in the country would be covered by the injunction. If the CFPB’s funding mechanism is found to be unconstitutional, the validity of all the Bureau’s rules will be called into question. If the Supreme Court finds that the Bureau’s funding is constitutional, the CFPB will have to promulgate new compliance dates for 1071 implementation to compensate for the stated period.