Collins v. Yellen: The Supreme Court Addresses Constitutional Challenges to the FHFA More Than a Decade After the Financial Crisis

Abstract

In a pair of decisions, Seila Law LLC v. Consumer Fin. Prot. Bureau and Collins v. Yellen, the U.S. Supreme Court addressed constitutional challenges to two agencies created during the depth of the 2008 Financial Crisis. The earlier Seila Law decision addressed challenges to the structure of the Consumer Protection Financial Bureau, which was headed by a single director not fully answerable to the President. In 2020, the Supreme Court found that structure to be unconstitutional, but avoided a dismantling of the agency by simply severing the “for cause” removal clause from the statute. In Collins v. Yellen, it did the same for the Federal Housing Finance Agency, finding that its structure could be saved by making its director removable at will.