Mulvaney cracks down on CFPB as White House insists he's in control

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Mulvaney announces hiring, regulation freezes at CFPB

Mick Mulvaney speaks amid battle over leadership at Consumer Financial Protection Bureau.

White House budget boss Mick Mulvaney moved quickly Monday to rein in the Consumer Financial Protection Bureau, imposing a 30-day hiring freeze and other new rules as the fight over who’s really in charge of the agency heads to court.

Mulvaney, whom President Trump chose to run the CFPB on a temporary basis, has a history of bashing the bureau and has called it a “sad, sick” joke.

He didn’t back away from those assertions Monday afternoon, describing the CFPB as “an awful example of a bureaucracy that has gone wrong and is almost entirely unaccountable.”

Mulvaney said he was surprised at the unchecked powers afforded to the bureau – including his.

“I am just finding out about the powers I have as acting director and they would frighten most of you,” he said. “It’s frightening to think about how little oversight Congress has over me now as I am the director.”

He said he wasn’t there “to shut the place down” -- but announced a swift set of changes late Monday afternoon, including the hiring freeze as well as a freeze on any new agency guidelines in the pipeline and on payments out of a civil penalties fund for 30 days.

“This agency will stay open. Rumors that I'm going to set the place on fire, or blow it up or lock the doors are completely false,” he said. “I am a member of the executive branch of government. We intend to execute the laws of the United States.”

Mulvaney said he will spend three days a week at the CFPB.

“Since my name is on the door, I want to be here,” he said.

The White House insisted Mulvaney is firmly in control of the agency, despite a court challenge from Leandra English, who was elevated to deputy director of the bureau last week by its outgoing director Richard Cordray, an Obama appointee -- putting her in line for acting director. Trump installed Mulvaney instead.

“Director Mulvaney has taken charge of that agency and he has the cooperation of the staff and appeared there this morning and things went very well,” White House Press Secretary Sarah Sanders said Monday afternoon, adding that Mulvaney is “the right person at this time” to head up the watchdog agency.

“The legal outline shows very clearly who is in charge of that agency,” Sanders added.

“Mr. Mulvaney is only the latest in a line of Trojan Horse nominees to undermine agencies from within,” Sen. Chuck Schumer, D-N.Y., responded. “The White House should abandon any effort to circumvent the succession process.”

Mulvaney took over the agency Monday morning, firing off a memo instructing staff to disregard directives from English.

“[I]t has come to my attention that Ms. English has reached out to many of you this morning via email in an attempt to exercise certain duties of the Acting Director. This is unfortunate but, in the atmosphere of the day, probably not unexpected,” he wrote.

“Please disregard any instructions you receive from Ms. English in her presumed capacity as Acting Director. ... If you receive additional communications from her today in any form, related in any way to the function of her actual or presumed official duties (i.e. not personal), please inform the General Counsel immediately.”

Reuters, which first obtained the memo, reported that he sent it after English sent an email welcoming staff back from their Thanksgiving holiday and signed off as “acting director.”

She is now suing the White House over Trump's decision to put Mulvaney in charge.

English and the White House duked it out in a federal courtroom in Washington before Judge Timothy Kelly, a Trump appointee recently approved by the Senate. Kelly gave government lawyers until tonight to file their opposition to Leandra English's request for a temporary restraining order.

Kelly said that he recognized the importance of moving this case quickly as it is in the public interest to have someone run this agency.

At one point government lawyers were asked if they could give any assurances as to English’s future at the CFPB in the absence of a speedy ruling. Government lawyer Brett Shumate said he could give no such assurances. After the hearing, Deepak Gupta, who represents English, told reporters he found that response “very disturbing.”

The extraordinary battle over who will lead the federal government’s top consumer financial watchdog began Friday after Cordray announced his resignation eight months ahead of schedule.

Cordray named English as his temporary successor, but Trump said it was his decision who would run the agency and named Mulvaney.

Sanders didn’t say why English wasn’t allowed to take over and added, “I’m not saying we have anything against her.”

Fox News' Jake Gibson contributed to this report.