{"id":47483,"date":"2026-03-16T21:22:02","date_gmt":"2026-03-16T18:22:02","guid":{"rendered":"https:\/\/mk.gen.tr\/judge-rejects-bid-to-cut-cfpb-funding\/"},"modified":"2026-03-16T21:22:02","modified_gmt":"2026-03-16T18:22:02","slug":"judge-rejects-bid-to-cut-cfpb-funding","status":"publish","type":"post","link":"https:\/\/mk.gen.tr\/tr\/judge-rejects-bid-to-cut-cfpb-funding\/","title":{"rendered":"Judge rejects bid to cut CFPB funding"},"content":{"rendered":"

A federal judge has ruled that the Consumer Financial Protection Bureau (CFPB)<\/strong> must continue getting its funding from the Federal Reserve<\/strong>, dealing a setback to Trump administration efforts to effectively shut down the agency.<\/p>\n

The ruling Friday by U.S. District Judge Edward Davila in San Jose blocks acting CFPB<\/a> Director Russell Vought from using a new legal interpretation that would have cut off the agency\u2019s funding stream.<\/p>\n

Litigation centers on dispute over language in the 2010 Dodd-Frank Act \u2014 the law that created the CFPB after the 2008 financial crisis.<\/p>\n

Unlike most government agencies, the CFPB doesn\u2019t get its money from Congress through annual appropriations. Instead, it\u2019s funded directly from the Federal Reserve<\/a>, which raises money through bank fees and other activities.<\/p>\n

Current law states the Fed shall transfer money to the CFPB from the \u201ccombined earnings\u201d of the Federal Reserve System.<\/p>\n

Vought, who was named acting director in February 2025, asked the Office of Legal Counsel<\/strong> for an opinion on what \u201ccombined earnings\u201d means. In November, that office concluded it means profits \u2014 meaning if the Fed isn\u2019t profitable, the CFPB can\u2019t get money from it.<\/p>\n

Based on that opinion, Vought decided not to ask the Fed for money. He instead asked Congress directly for funding, a process that would have required lawmakers to pass a new spending bill.<\/p>\n

Three nonprofit groups that rely on CFPB data \u2014 Rise Economy<\/strong>, the Woodstock Institute<\/strong> and the National Community Reinvestment Coalition<\/strong> \u2014 sued, arguing Vought\u2019s interpretation was wrong and would effectively starve the agency.<\/p>\n

Judge Davila agreed.<\/p>\n

He found that Vought\u2019s interpretation \u201cfrustrates Congress\u2019s intent to insulate the Bureau\u2019s funding stream from this transparent display of partisanship.\u201d<\/p>\n

The judge noted that Vought said publicly<\/a> this past October that he was working to \u201cclose down the agency\u201d and would be successful within months.<\/p>\n

In his ruling, Davila wrote that Vought\u2019s plan to shut down the CFPB using \u201cthis clearly erroneous interpretation\u201d goes against what Congress intended when it created the agency.<\/p>\n

The court declared that Vought\u2019s reliance on the legal opinion was \u201carbitrary, capricious and in violation of law,\u201d and ordered the CFPB to keep requesting money from the Federal Reserve as the law requires.<\/p>\n

The CFPB was created to oversee financial products like mortgages, credit cards and payday loans. It handles consumer complaints and collects data on lending practices that groups use to track whether banks are properly serving their communities.<\/p>\n

Without that funding, plaintiffs argued, they would lose access to information they need to do their work.<\/p>\n

The judge found that argument convincing, saying the groups had shown they would suffer \u201cinformational harm\u201d if the CFPB lost funding.<\/p>","protected":false},"excerpt":{"rendered":"

A federal judge has ruled that the Consumer Financial Protection Bureau (CFPB) must continue getting its funding from the Federal Reserve, dealing a setback to Trump administration efforts to effectively shut down the agency. The ruling Friday by U.S. District Judge Edward Davila in San Jose blocks acting CFPB Director Russell Vought from using a…<\/p>","protected":false},"author":0,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"inline_featured_image":false},"categories":[1],"tags":[],"_links":{"self":[{"href":"https:\/\/mk.gen.tr\/tr\/wp-json\/wp\/v2\/posts\/47483"}],"collection":[{"href":"https:\/\/mk.gen.tr\/tr\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mk.gen.tr\/tr\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/mk.gen.tr\/tr\/wp-json\/wp\/v2\/comments?post=47483"}],"version-history":[{"count":0,"href":"https:\/\/mk.gen.tr\/tr\/wp-json\/wp\/v2\/posts\/47483\/revisions"}],"wp:attachment":[{"href":"https:\/\/mk.gen.tr\/tr\/wp-json\/wp\/v2\/media?parent=47483"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mk.gen.tr\/tr\/wp-json\/wp\/v2\/categories?post=47483"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mk.gen.tr\/tr\/wp-json\/wp\/v2\/tags?post=47483"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}