By Peter Schroeder - 04/23/13 04:56 PM EDT
Rep. Maxine Waters (D-Calif.) on Tuesday promised to foil the Republican ban on testimony from consumer bureau chief Richard Cordray.
"If you choose to continue to ignore the law, then I am prepared to use the rules of the committee to provide the director the opportunity to give testimony before the committee," Waters wrote in a letter to Rep. Jeb Hensarling (R-Texas), the chairman of the Financial Services panel.
On Monday, Hensarling announced that the committee would refuse to hear semiannual testimony from Cordray. He said a recent court decision that overturned some of President Obama's recess appointments means Cordray has no right to testify before the committee.
"There is no legally appointed director of the CFPB at this time," Hensarling said.
Waters is crying foul, accusing Hensarling of "unilaterally" ruling on the legality of Cordray's appointment before a court has weighed in.
"The notion that some legal scholars dispute the constitutionality of Director Cordray's appointment does not in fact make it 'clear' ... that the constitutionality of Director Cordray's appointment is currently invalid or will inevitably overturned," she said. "Until the Supreme Court rules on the constitutionality of Director Cordray's appointment ... he is the director of the CFPB and must be treated as such."
A spokesman for Waters said if Republicans continue to bar Cordray, Democrats would invite him to testify to any hearings where he could be considered germane as their witness. Republicans could reject his appearance, but under committee rules, if a majority of Democrats on the panel demand his testimony, he would appear during a second day of testimony, according to the spokesman.
If Waters follows through, it would make it nearly impossible for the committee to prevent Cordray from testifying; the CFPB covers a wide range of financial issues where his testimony could be considered germane.
A Hensarling spokesman reiterated Tuesday that Cordray would not be permitted to deliver the bureau's semiannual report to Congress, but stopped short of saying he would be barred from ever testifying before the panel.
"Under the Dodd-Frank Act, the semiannual report can be delivered only by the director of the CFPB," said the spokesman. "Mr. Cordray does not meet the legal requirements to hold the position of CFPB director, so the committee will not hold a hearing on the semiannual report until there is a legally appointed director.”
Hensarling on Monday said Obama's recess appointment of Cordray, made at the beginning of 2011, is destined to be overturned in court, and that as a result he cannot be considered the legal director of the agency.
He said the committee would hear from Cordray only after he has been confirmed by the Senate — an unlikely proposition, as Republicans continue to oppose his nomination while they demand changes to his bureau.
After Republicans blocked Cordray's nomination on the Senate floor in 2011, Obama recess-appointed him CFPB director. Republicans said the move was illegal, arguing that the brief "pro forma" sessions held during longer breaks meant there was no recess in which to make appointments.
A U.S. District federal appeals court in January ruled that three recess appointments made the same day to the National Labor Relations Board (NLRB) were unconstitutional. CFPB critics say it's just a matter of time before Cordray's recess appointment is also overturned.
The NLRB is challenging the ruling with the U.S. Supreme Court, while Cordray's appointment is being challenged as part of a separate lawsuit against several provisions of the Dodd-Frank financial reform law.
Hensarling said the appeals court ruling "makes clear" that Cordray is not legally the director of the Consumer Financial Protection Bureau.
On Tuesday, the Senate Banking Committee heard testimony from Cordray, where no Republicans in attendance aired a similar protest. Sen. David Vitter (R-La.), who is on the committee but did not attend the hearing, said afterward that Cordray should not have been allowed to testify.
— Updated at 2:24 p.m.