Within two months of Donald Trump returning to the White House, the president and his team had radically altered the direction of the Consumer Financial Protection Bureau. Instead of allowing the CFPB to champion the interests of American consumers, White House budget director Russell Vought scrapped the bureau’s enforcement cases and even took steps to give money back to a mortgage lender that had agreed to settle racial discrimination claims.
In the months that followed, consumer groups estimated that the Trumpification of the CFPB had cost American consumers roughly $18 billion.
This was outrageous, but the public could at least take comfort in knowing that the agency’s doors remained open. That might soon change.
About a month ago, Reuters reported that Vought was moving forward with plans to shutter the CFPB, sparking immediate pushback from Democrats on the Senate Banking Committee, who were quick to warn the Office of Management and Budget chief that the Republican administration cannot simply close agencies it doesn’t like.
A month later, Vought — one of the key authors of the right-wing policy blueprint Project 2025, which called for the CFPB’s demise — is advancing his plan anyway. Politico reported:
The Trump administration has formally determined the Consumer Financial Protection Bureau’s current funding mechanism is unlawful, a move that puts the agency on track to close in the coming months when its existing cash runs out. The decision, disclosed in a court filing late Monday, marks the administration’s most direct effort yet to dismantle the consumer watchdog and sets up a new front in the ongoing legal battle over its future. The administration said it now considers the CFPB legally barred from seeking additional money from the Federal Reserve, which is the agency’s typical source of funding.
On its current trajectory, the bureau soon will no longer have the funds needed to keep the lights on.
Congress could intervene, but given the fact that Capitol Hill is led by Republican opponents of the CFPB, that seems extraordinarily unlikely.
In case this isn’t obvious, the Consumer Financial Protection Bureau remains one of the best examples of progressive governance in the 21st century. Taking on everything from banks to the student loan industry, payday lenders to mortgage companies, the bureau — first championed as an idea by Democratic Sen. Elizabeth Warren of Massachusetts — has looked out for Americans’ interests since its inception.
Late last year, Helaine Olen explained in a piece for MSNBC: “Over its almost 13 years, the agency has stopped numerous financial ripoffs and returned billions of dollars to the public. Its mere existence provides an ongoing demonstration of how the government can effectively stand up to big money interests and protect the American people.” A report from The New York Times added soon after that this one agency “has clawed back $21 billion for consumers. It slashed overdraft fees, reformed the student loan servicing market, transformed mortgage lending rules and forced banks and money transmitters to compensate fraud victims.” The Trump White House doesn’t just want to curtail these efforts, it also wants to stop them — permanently. It’s likely that Vought’s gambit will spark a new round of litigation, but as things stand, the future of the Consumer Financial Protection Bureau is in serious doubt. This post updates our related earlier coverage.
Steve Benen is a producer for "The Rachel Maddow Show," the editor of MaddowBlog and an MS NOW political contributor. He's also the bestselling author of "Ministry of Truth: Democracy, Reality, and the Republicans' War on the Recent Past."
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