	Introduction

The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act; P.L. 111-203 ) substantially overhauled the U.S. financial regulatory system. Title X of the Dodd-Frank Act, the Consumer Financial Protection Act (CFP Act), established the Bureau of Consumer Financial Protection (CFPB or Bureau) within the Federal Reserve System. The CFP Act alters the consumer financial protection landscape by consolidating regulatory authority and, to a lesser extent, supervisory and enforcement authority in one regulator—the CFPB. Not all of the CFPB's powers become effective at the same time. Some of the Bureau's authorities took effect when the Dodd-Frank Act was signed into law on July 21, 2010. However, most of the Bureau's authorities will go into effect on the "designated transfer date"—a date six to 18 months after enactment, as determined by the Secretary of the Treasury (Secretary). Currently, the designated transfer date is July 21, 2011. In addition to the effective dates set out in the CFP Act, the authority to exercise the Bureau's powers also may be affected by the appointment of a Director, and the date of the appointment. The Bureau is designed to be headed by a single Director, who is to be nominated by the President, subject to the advice and consent of the Senate. The CFP Act provides the Secretary the authority to exercise some, but not all of the Bureau's authorities until a CFPB Director is appointed. More specifically, the powers that will be transferred to the Bureau under subtitle F include
"all authority to prescribe rules or issue orders or guidelines pursuant to any Federal consumer financial law," including the rulemaking authority under the 18 enumerated consumer laws, held by the HUD, FRB, OCC, OTS, FDIC, and NCUA; certain consumer compliance examination and other supervisory authorities over "larger depository institutions" (i.e., banks, thrifts, savings associations, and credit unions with more than $10 billion in assets); primary enforcement authority of consumer financial laws and regulations over larger depositories; subject to certain limitations, the FTC's authority "to prescribe rules, issue guidelines, or conduct a study or issue a report mandated under [the enumerated consumer laws] ... "; the authority to coordinate a process by which certain employees of all of the transferor agencies other than the FTC are identified to be transferred to the CFPB, as necessary to perform the transferred authorities. Although not beyond debate, CFP Act subsection 1066(a) appears to provide the Secretary the power to exercise all of the Bureau's transferred authorities, as provided under subtitle F, when they become effective and until a CFPB Director is appointed. Authorities Established by Provisions Other Than Subtitle F

The powers provided to the Bureau pursuant to provisions other than those of subtitle F generally are the Bureau's "newly established" powers – i.e., the enhanced consumer protection authorities that were not explicitly provided by law to federal regulators before the Dodd-Frank Act. The Secretary's Performance of Bureau Functions Since the Date of Enactment and Potential Issues After the Designated Transfer Date

Based on a review of information made publicly available by the Secretary and the Bureau, as well as the congressional testimony of multiple Treasury Department officials, it appears that the actions taken thus far by the Bureau predominately have been either administrative functions or measures taken in preparation for the exercise of the substantive authorities that will go into effect on the designated transfer date. As a result, the Secretary's interim Bureau powers arguably will be more expansive after the designated transfer date if a Bureau Director has not yet been appointed. This potential expansion of interim powers would increase the likelihood that the Bureau would move beyond administrative and preparatory steps to engaging in substantive actions that directly, and potentially significantly, impact financial institutions that participate in consumer financial markets. In practice, however, the limits of the Secretary's authorities may not always be clear. Outcomes of such lawsuits are difficult to predict in the abstract, in part, because of the innumerable facts and circumstances that could give rise to these legal claims.
The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act; P.L. 111-203) substantially overhauled the U.S. financial regulatory system. Title X of the Dodd-Frank Act, the Consumer Financial Protection Act (CFP Act), established the Bureau of Consumer Financial Protection (CFPB or Bureau) within the Federal Reserve System. The CFP Act alters the consumer financial protection landscape by consolidating regulatory authority and, to a lesser extent, supervisory and enforcement authority in one regulator—the CFPB. The CFP Act empowers the Bureau through: the transfer of existing consumer protection powers from other federal regulators ("transferred powers" or "transferred authorities"); and the establishment of enhanced consumer protection authorities that were not explicitly provided by law to federal regulators prior to the Dodd-Frank Act's enactment ("newly established powers" or "newly established authorities"). The Bureau's transferred authorities will include the power to prescribe regulations under 18 federal consumer protection laws, such as the Truth in Lending Act, as well as certain consumer compliance supervisory and enforcement powers over some large banks and other depository institutions; its newly established powers will include consumer compliance supervisory and enforcement powers over certain non-depository financial institutions, such as payday lenders and mortgage brokers.
Not all of the CFPB's powers become effective at the same time. Some of the Bureau's authorities took effect when the Dodd-Frank Act was signed into law on July 21, 2010. However, most of the Bureau's authorities will go into effect on the "designated transfer date"—a date six to 18 months after enactment, as determined by the Secretary of the Treasury (Secretary). Currently, the designated transfer date is July 21, 2011.
In addition to the effective dates set out in the CFP Act, the authority to exercise the Bureau's powers may be affected by the appointment of a CFPB Director. The Bureau is designed to be headed by a single Director, who is to be nominated by the President and subject to the advice and consent of the Senate. If a Director is appointed before the designated transfer date, he will be able to exercise all of the powers provided to the Bureau pursuant to the CFP Act. However, a Bureau Director has not yet been appointed. Until a CFPB Director is appointed, the CFP Act provides the Secretary the authority to exercise some, but not all of the Bureau's authorities. Although not beyond debate, the CFP Act appears to provide the Secretary the authority to exercise the Bureau's transferred powers, but not the authority to exercise the Bureau's newly established powers. In practice, the limits of the Secretary's authorities may not always be clear.
The actions taken thus far by the Bureau predominately have been either administrative functions or measures taken in preparation for the exercise of the substantive authorities that will go into effect on the designated transfer date. These actions appear to fall within the Secretary's limited Bureau authorities. The Secretary's interim Bureau powers arguably will be more expansive after the designated transfer date if a Bureau Director has not yet been appointed. This expansion of power would increase the likelihood that the Bureau would move beyond administrative and preparatory steps to engaging in substantive actions that directly, and potentially significantly, impact financial institutions. Parties claiming harm from these potential actions might be inclined to initiate lawsuits arguing that certain actions exceed the Secretary's authority. Outcomes of such lawsuits are difficult to predict in the abstract, in part, because of the innumerable facts and circumstances that could give rise to these legal claims.