CFPB Tales Told Out of School (Updated)
Former CFPB enforcement attorney Ronald Rubin has a lengthy attack on the CFPB in the National Review. It's got lots of sultry details, but there's nothing new and verifiable in the piece. Instead, it's all tales told out of school, unverifiable personal anecdotes by Rubin, who seems to have an particular axe to grind with certain other CFPB staffers, and an ideological one too. Incredibly, Rubin, a former Managing Director for legal and compliance at Bear Stearns, holds up the oft-feckless SEC as a model of good enforcement practice, and criticizes the CFPB for any departures from that practice.
The point of the piece seems to be that the CFPB is an agency gone rogue and that this wouldn't have happened if the CFPB had just been structured as a bi-partisan commission. That's hogwash. Assume that everything Rubin claims is true and correct. Even if so, every single problem Rubin identifies in the piece could just as easily have occurred at a bi-partisan commission. Partisan hiring? Of course that can happen because the staff hiring decisions (other than those of the personal staffs of the commissioners) are done by the commission chair and people the chair has selected. Secrecy and stonewalling Congress? We see allegations about that regarding agencies all the time (and that from agencies not facing partisan witch-hunts). Unhappy employees? Check. Pressure on regulated firms to settle enforcement actions? Check. Claims of discrimination by employees? Check. These are problems that can occur at any agency, irrespective of its structure or funding.
No, Rubin's conclusions don't follow from his gossipy tales, but they do follow form his anti-regulatory world view, whose "primary influences were my business-school professors at the University of Chicago, the epicenter of free-market capitalism." Uh-huh.
Update: I knew something felt strange about this piece when I read it at first, but only now is it clear: Rubin seems to have violated legal professional ethics requirements by breaching client confidentiality. There's a reason one doesn't see this sort of kiss-and-tell piece very often, and that's because of confidentiality requirements.
Recall that Rubin wasn't just some random CFPB employee. He was an attorney for the CFPB. The agency was his client. That means he owed and continues to owe the CFPB certain duties. Among those is a duty of confidentiality (ABA Model Rule of Professional Conduct 1.6). There are certain exceptions to that duty, but it's pretty clear that none apply here. There's no exception for political dislike. Even if Rubin thought that the CFPB were unconstitutional, there's no exception for that. The exception for "to comply with other law or court order," is not meant to cover questions about agency constitutionality (the answer to which hasn't changed an iota since Rubin's employment at the CFPB began).
The duty of confidentiality extends to former clients (ABA Model Rule of Professional Conduct 1.9(c)). There's an exception to the confidentiality requirement for "when the information has become generally known," but that doesn't cover Rubin's disclosures. And if there were any doubt about whether these rules apply to government attorneys, just look at ABA Model Rule of Professional Conduct 1.11(a)(1), which provides that "a lawyer who has formerly served as a public officer or employee of the government ... is subject to Rule 1.9(c)."
I don't know if the CFPB requires its attorneys to sign a confidentiality agreement like the one for DOJ attorneys, but I have trouble reading Rubin's piece without thinking that if his statements are accurate that his article appears to be a breach of his duty of confidentiality to a former client, disclosing both client's confidential litigation strategy and other confidential communications, including those that might be subject to attorney-client privilege. The confidentiality of those communications is not Rubin's to waive.
I doubt the CFPB will file an ethics complaint against Rubin, and the ethics issue doesn't speak to the veracity of Rubin's claims, but I know that if I were a client I wouldn't feel comfortable hiring an attorney with such a demonstrably loose tongue.