The laws that will determine who will lead the CFPB - Axios
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The laws that will determine who will lead the CFPB

Mick Mulvaney's first day of work at the CFPB. Photo: Jacquelyn Martin / AP

On the first day of work at the Consumer Financial Protection Bureau after former director Richard Cordray stepped down, two people showed up to lead the agency: White House budget director Mick Mulvaney, President Trump's appointee for acting director, and the CFPB's deputy director Leandra English, Cordray's pick.

The big picture: The CFPB's General Counsel has said she acknowledges Mulvaney's authority, but it is still unclear who will ultimately lead the agency. Neither Mulvaney nor English have backed down, and both sent introductory emails to staff Monday morning.

Where things stand

On his first day...

  • Mulvaney showed up to the CFPB with donuts, and then he sent a memo to staffers telling them to "disregard any instructions" from English "in her presumed capacity as acting director."
  • John Czwartacki, Mulvaney's top communications aide, told Axios that the budget directors transition at the CFPB "could not have been smoother."

On her first day...

  • English also sent an email to staff, introducing herself and signing off as "Acting Director."
  • But Czwartacki told Axios he has not seen English, or anyone acting as her proxy, at the agency's office.
  • English has sued the Trump administration for its appointment of Mulvaney to the post, citing the Dodd-Frank Act.
  • Monday afternoon, she is scheduled to meet with Sen. Elizabeth Warren on Capitol Hill.

What's next

Per the Dodd-Frank Act of 2008...

  • The deputy director "shall serve as acting Director in the absence or unavailability of the Director."
  • Deepak Gupta, English's lawyer, has said she is to serve as acting director until the Senate confirms a new director, per the law.
  • Sen. Dick Durbin said on CNN's State of the Union that Dodd-Frank "says that when the director steps aside, the deputy director shall be in charge of the agency ... Not may — shall — be in charge."

Per the Vacancies Reform Act of 1998...

  • If the head of an executive agency resigns, "the first assistant to the office of such officer shall perform the functions and duties of the office temporarily in an acting capacity," but the President "may direct a person who serves in an office for which appointment is required to be made by the President, by and with the advice and consent of the Senate, to perform the functions and duties of the vacant office temporarily in an acting capacity..."
  • Between the lines: The Vacancies Reform Act echoes Dodd-Frank that the deputy director will take charge when the director resigns, but includes a provision that the President may appoint an acting head instead.
  • The White House has defended its appointment of Mulvaney with this act.
  • "The vacancies act allows the President to name a successor. Furthermore, the President has the authority to simply fire the existing deputy director," Former House Financial Services Committee Senior Counsel J.W. Verret said.
  • Sen. Lindsey Graham countered Durbin on CNN's State of the Union and cited the Vacancies Reform Act. "I hope it's Mick Mulvaney," he said.
Featured

Roy Moore refuses to concede

Republican U.S. Senate candidate Roy Moore looks at election returns. Photo: Brynn Anderson / AP

Republican candidate Roy Moore said late Tuesday night that the election for Alabama's U.S. Senate seat wasn't over.

"God is always in control. Part of the problem with this campaign is we've been painted in an unfavorable and unfaithful light. We've been put in a hole, if you will...what we've got to do is wait on God, and let this process play out...The votes are still coming in and we're looking at that." However, Alabama's Secretary of State told CNN the people of Alabama had spoken, and Doug Jones was the winner.

Go deeper: How Alabama elected Doug Jones.

Featured

Winners & losers from the Alabama special election

Photo: John Bazemore / AP

A Democrat will serve as an Alabama Senator for the first time in two decades after Republican Roy Moore's campaign collapsed following allegations of child sexual abuse.

Why it matters: This is a big, unexpected win for Democrats, and follows another key victory in the Virginia governor's race. It's bad news for the Steve Bannon brand of conservatism and President Trump, who went all in for Moore in the closing weeks.

​Winners:

  • Doug Jones, who had never run for public office before, and won as a Democrat in a red state.
  • Democrats​ now have another important notch on their belt, and will close the gap in the Senate to 51-49.
  • #MeToo: Many voters believed Moore's accusers, and the accusations brought down his campaign.
  • Mainstream Republicans: Moore's baggage would have presented plenty of problems for the GOP down the road, even if they are losing a vote in the Senate.

Losers:

  • Roy Moore: He did the unthinkable, and lost to a Democrat in a statewide Alabama race.
  • Steve Bannon: He was the one promoting Moore from the beginning, over fierce objections within his own party.
  • The Republican Party: The RNC and the president backed an accused sexual predator, and lost. They're also now down a Senate seat.
  • President Trump: He decided to throw his full-throated support behind Moore, and in so doing made his second incorrect bet on the Alabama race. Not to mention, he was the one who appointed Jeff Sessions as Attorney General — considering it a safe seat.
Featured

Trump, Biden, Clinton react to Doug Jones' victory over Roy Moore

Democrat Doug Jones pulled out a victory over Republican Roy Moore on Tuesday night, after a race that was turned on its head by allegations of child sexual abuse against Moore. Moore was the second Alabama Republican endorsed by President Trump to lose, after he Moore defeated Trump-backed Luther Strange in the primary. Trump congratulated Jones on "a hard fought victory."


Featured

Both Trump-endorsed candidates lose in Alabama

Trump told voters to elect Roy Moore. Photo: AP

President Trump has now twice endorsed the losing candidate in Alabama. He backed Luther Strange in the Republican primary, and threw his weight behind Roy Moore for the general election. Moore was defeated by Democrat Doug Jones tonight.

The big picture: Trump won Alabama by almost 20 points in the 2016 election, but Alabama voters rejected his favored candidates in the Senate race. The same thing happened on Nov. 8 in Virginia, when voters elected Democrat Ralph Northam over Trump-backed Republican Ed Gillespie by a 9-point margin.

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Alabama voters reject Roy Moore, elect Democrat Doug Jones

Doug Jones. Photo: Brynn Anderson / AP

Democrat Doug Jones has defeated Republican Roy Moore for the Senate seat held until recently by Attorney General Jeff Sessions. Moore was overwhelmingly the favorite until nine women accused him of sexual misconduct.

Why it matters: Alabama is a deep red state that went 62% for President Trump and hadn't elected a Democrat to the Senate in 25 years. Trump endorsed Roy Moore, recorded a robocall on his behalf and labeled Jones a "Pelosi/Schumer Liberal Democrat." The defeat will narrow the Republican margin in the Senate to 51-49.

Go deeper: Meet Doug Jones ; Results map ; Trump's picks go 0-2

Featured

Results from Alabama as Jones defeats Moore

Data: Decision Desk HQ; Graphic: Chris Canipe, Lazaro Gamio and Gerald Rich / Axios

In a result that seemed unthinkable just weeks ago, Democrat Doug Jones defeated Republican Roy Moore to claim the Senate seat held until recently by Attorney General Jeff Sessions. Moore's campaign collapsed following accusations of child sexual assault against him.

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FBI agents on Russia probe called Trump an "idiot"

Photo: AP

Two FBI agents who were assigned to investigate alleged collusion between the Trump campaign and the Kremlin exchanged text messages in which they referred to President Trump as an "idiot," Politico reports, citing copies of the messages provided to Congress by the Justice Dept.

The backdrop: Special Counsel Robert Mueller fired one of the agents, Peter Strzok, from the investigation in late July, "immediately" after he learned of the text exchange, the Justice Dept. told Congress. Lisa Page, the other agent in question, had already left Mueller's team by that point.

Featured

Schumer calls cops after forged sex scandal charge

Photo: J. Scott Applewhite / AP

Senate Minority Leader Chuck Schumer (D-N.Y.) said he was the victim of a fake news hit on Tuesday, and has turned over to Capitol Police a document that purports to detail lurid sexual harassment accusations by a former staffer.

Why it matters: This was an apparent effort to dupe reporters and smear a senator — both symptoms of an amped-up news environment where harassment charges are proliferating and reporters have become targets for fraud.

  • The former staffer told me in a phone interview that she did not author the document, that none of the charges ring true, and that her signature was forged.
  • She said she had never heard of the document before Axios took it to Schumer's office for comment on Tuesday.
  • Matt House, Schumer's communications director, told me: "The document is a forged document and every allegation is false. We have turned it over to the Capitol Police and asked them to investigate and pursue criminal charges because it is clear the law has been broken."
  • House continued: "We believe the individual responsible for forging the document should be prosecuted to the fullest extent of the law to prevent other malicious actors from doing the same."

The backstory:

  • A password-protected PDF of the 13-page document was shopped to Axios and other outlets. The document, which is dated 2012 and has the file name "Schumer_Complaint," looks like a lawsuit filed in U.S. District Court for the District of Columbia.
  • One of many red flags: No lawyer for the staffer is named.
  • The woman named in the document was a legislative staffer for Schumer from 2009 to 2012, and is now a career employee of the federal government.
  • The former staffer said she took the matter to Washington, D.C. police on Tuesday. She said the police told her they were unsure of their jurisdiction in the case. She said she now plans to go to Capitol Police.
  • She told me in a statement: "The claims in this document are completely false, my signature is forged, and even basic facts about me are wrong. I have contacted law enforcement to determine who is responsible. I parted with Senator Schumer's office on good terms and have nothing but the fondest memories of my time there."
  • Axios agreed to her stipulation that she not be named, because she said she is the victim of a crime.

A source close to Schumer said the document is full of errors:

  • "The document contains an allegation of inappropriate behavior on September 16th 2011 in Washington, but Schumer was in New York City."
  • "It contains an allegation of inappropriate behavior by Schumer on August 25th 2011 in Washington, but Schumer was in France."
  • The source tells Axios that reporters from the Washington Post, CNN, BuzzFeed, The New Yorker and ABC all inquired about the document Tuesday.

Be smart: Look for more hits like this, aimed at victimizing both reporters and public figures.

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Featured

In tax plan negotiations, corporate rate currently sits at 21%

Rubio. Photo: Pablo Martinez Monsivais / AP

The corporate tax rate currently stands at 21%, according to three sources familiar, as lawmakers work to finalize the tax bill they hope to vote on by next week.

  • Why it matters: Both the House and Senate passed bills that would cut the top corporate rate to 20%, but hours after the Senate bill passed, President Trump said he would accept a 22% rate.
  • Sen. Marco Rubio tweeted on Tuesday, likely referring to reports that the individual rate is being lowered to 37%: "20.94% Corp. rate to pay for tax cut for working family making $40k was anti-growth but 21% to cut tax for couples making $1million is fine?" Rubio had wanted to raise the corporate tax to pay for a more generous child tax credit, but was shut down.
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Charming Charlie becomes 20th major retailer to file for bankruptcy this year

Charming Charlie, the Houston-based jewelry and accessories retailer, announced Tuesday that it reached an agreement with lenders and equity sponsors to clear the way for its filing of Chapter 11 bankruptcy.

What went wrong: Charming Charlie's bread-and-butter, affordable jewlery, is an ideal product for online sellers, given that it can be warehoused and shipped cheaply. What's more, even as business migrated online, Charming Charlie overextended itself, opening 79 stores between 2013 and 2015.

Why it matters: It's the twentieth major retailer to have filed for bankruptcy protection in 2017.

Charming Charlie burst onto the retail scene in 2004, with stores uniquely organized by color, and offering products at prices between high-end jewlery stores and discount shops like Claire's, which is aimed at the teenage market.