- A group of twenty-two Democratic AGs sued Russell Vought, in his official capacity as Acting Director of the CFPB, alleging that his actions to dismantle the agency are unlawful.
- According to the complaint, Vought has sought to effectively shut down the CFPB by attempting to lay off roughly 90 percent of its staff and refusing to request funding from the Federal Reserve, despite statutory requirements governing the agency’s funding mechanism. The complaint alleges that these actions conflict with the CFPB’s statutory duties, including its obligation to cooperate with states on consumer protection matters.
- The AGs claim that, absent a funding request, the CFPB would exhaust its remaining funds and become inoperable as early as January 2026; however, in related litigation, a federal judge recently ruled that the administration could not allow CFPB funding to lapse and directed that the CFPB must continue to receive or request funding from the Federal Reserve.
- We have previously reported on other Democratic AG efforts responding to recent changes at the CFPB, including a letter urging the agency to retain credit protections, a letter opposing a proposed rule that would limit the CFPB’s authority to oversee nonbank financial services providers, and multiple letters urging the agency to reject proposals limiting oversight of certain financial markets.