Judge orders Trump administration to continue to seek funding for the CFPB

"A federal district court judge ruled Tuesday that the Trump administration must continue to seek funding for the Consumer Financial Protection Bureau, or CFPB, a watchdog agency the administration has been trying to dismantle through staffing and funding cuts. The administration recently made a legal argument that because the agency gets its funding from the Federal Reserve, and since the Fed is technically operating at a loss, there are no valid funds for the CFPB."

"Judge Amy Berman Jackson rejected the argument, writing that this "would be tantamount to closing what is left of the Bureau." This upholds an earlier injunction from Jackson to ensure the agency would continue to exist as congressionally mandated, and to stop efforts to shutter the CFPB, including through layoffs. Separately, last week a coalition of 21 states and the District of Columbia joined together for a lawsuit to prevent the defunding of the agency."

Judge Amy Berman Jackson ruled that the Trump administration must continue to seek funding for the Consumer Financial Protection Bureau and rejected the claim that Federal Reserve losses eliminate valid funds for the agency. Jackson wrote that such an argument "would be tantamount to closing what is left of the Bureau" and upheld an injunction blocking layoffs. A coalition of 21 states and the District of Columbia sued to prevent defunding, arguing the administration is too narrowly interpreting which Fed funds can support the CFPB. The bureau was created after the 2008 financial crisis to protect consumers.

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