‘Payday lending rule’ lives (for now) as Congress lets deadline to invalidate slip by

The “payday lending rule” issued by the Bureau of Consumer Financial Protection (BCFP, formerly known as the CFPB) last year stands in place for now, as a deadline passed this week for Congress to take action to invalidate the regulation.

Meanwhile, although it has announced plans to “revisit” the rule, the bureau has yet to outline what it intends to do. The rule takes effect (for the most part) in August of next year.

And, while that deadline has passed, another is coming up: by June 22, the president must nominate someone as permanent director of the bureau – or risk seeing his selection of “acting director” run out of time to continue serving.

On the payday lending rule, Congress had until Wednesday to act under the Congressional Review Act (CRA) to vote to eliminate the regulation. That was the end of a period of 60 “legislative days” (days that Congress is in session) to take action. The rule was installed under the aegis of the former bureau director, Richard Cordray.

Neither the House nor Senate had taken a vote under CRA on the rule by Wednesday.

Soon after the current leader of the bureau, Acting Director Mick Mulvaney, took office in November (on an appointment by President Donald Trump), he announced that the agency would revisit the payday lending rule.

Since then, BCFP has placed that action on its “spring 2018 regulatory agenda.” In that listing, the bureau only notes: “The Bureau of Consumer Financial Protection (Bureau) announced in January 2018, that it intends to open a rulemaking to reconsider its 2017 rule titled Payday, Vehicle Title, and Certain High-Cost Installment Loans. Lenders would not need to comply with provisions of that rule until August 2019.” No additional details are provided.

Another deadline approaching for the bureau is the tenure of Mulvaney as acting director. Under the Federal Vacancies Reform Act of 1998 (FVRA) – the law under which Trump appointed him to his current post – Mulvaney’s time as acting director could end by June 22 – one month from Tuesday. That’s the end of the period, under the measure, that Mulvaney’s time as “acting” is valid, if no one else is nominated by the president to take his place.

Under the FVRA, an acting officer appointed by the president under that provision serves “subject to the time limitations” spelled out in the law. Those include that an appointee may serve “for no longer than 210 days beginning on the date the vacancy occurs,” or, “subject to subsection (b), once a first or second nomination for the office is submitted to the Senate, from the date of such nomination for the period that the nomination is pending in the Senate.”

Additionally, the statute outlines that if the president’s first nomination is rejected, withdrawn, or returned by the Senate, the acting officer can continue to serve for no more than 210 days after the date of the rejection, withdrawal or return.

If a second nomination is made, the FVRA notes, the acting officer can continue to serve until the second nomination is confirmed or for no more than 210 days after the second nomination is rejected, withdrawn, or returned. If the last day of any 210-day period is a day on which the Senate is not in session, the second day the Senate is next in session and receiving nominations is deemed the last day of such period, the law notes.

However, if the president does send a nomination to the Senate before June 22, Mulvaney may continue in his role at BCFP until that individual is confirmed (or withdrawn, returned or rejected, which would trigger a new 210-day period).

CFPB spring 2018 regulatory agenda: Payday, Vehicle Title, and Certain High-Cost Installment Loans