A full panel of judges will decide whether the structure of the Consumer Financial Protection Bureau is constitutional, according to court documents filed Thursday, throwing a lifeline to the embattled agency.
The administration of Donald Trump is hostile to the CFPB, which is charged with protecting consumers from abuse by banks and other financial institutions. The bureau is an independent institution run by a single director, Richard Cordray. He serves a five-year term, and the president has limited power to remove him from office.
Mortgage servicer PHH filed a lawsuit in 2014 challenging the CFPB's authority. In October, a three-judge panel of U.S. Court of Appeals in Washington found that the agency's structure is unconstitutional. But on Thursday, the court granted the CFPB's request for a review by a broader set of judges.
Oral arguments are scheduled for May 24.
"It gives us a much better shot at protecting the CFPB," said Ed Mierzwinski, senior fellow at U.S. PIRG, a consumer advocacy group. "It's a very significant step forward."