SCOTUS Upholds Constitutionality of CFPB’s Funding Mechanism

  • The U.S. Supreme Court issued an opinion in CFPB v. Cmty. Fin. Servs. Assn. of Am., Ltd. upholding the funding structure of the CFPB.
  • The Fifth Circuit had determined that the CFPB’s funding mechanism—drawing funds from the Federal Reserve System’s earnings—violated the Appropriations Clause.
  • The Court reversed and remanded the case to the Fifth Circuit, and held that the Congress’ statutory authorization allowed the CFPB to draw funds in that way to carry out the CFPB’s duties.