- The Supreme Court announced that it will resolve a circuit split over the constitutionality of the CFPB’s funding mechanism. The case is CFPB et al. v. Community Financial Services Association of America, Limited et al.
- The CFPB, created in 2010 after the 2008 financial crisis, is funded through annual transfers by the Federal Reserve. A coalition of 16 Republican AGs have asked the Court to affirm the Fifth Circuit Court of Appeals’ holding that the CFPB’s funding scheme violates the Appropriations Clause and separation of powers. The Fifth Circuit used the alleged unconstitutionality of the CFPB’s funding as a basis to vacate one of the Bureau’s rules.
- A separate coalition of 22 Democratic AGs have asked the Court to reverse the Fifth Circuit’s ruling and deem that the CFPB’s funding is a valid use of Congress’s appropriations power, arguing that the ruling threatens substantial harm to the States because the CFPB offers nationwide consumer financial protections. The CFPB’s Petition for a Writ of Certiorari argues that the Fifth Circuit’s ruling threatens the validity of all CFPB actions since its inception.