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Trump administration moves again to dismantle top US consumer watchdog

Old_JoeOld_Joe
in Other Investing
Following are excerpts from a current report in The Guardian:

Government argues funding mechanism behind Consumer Financial Protection Bureau is unlawful
The Trump administration has launched its most direct attempt yet to shut down the top US consumer watchdog, arguing the current funding mechanism behind the Consumer Financial Protection Bureau (CFPB) is unlawful.

Attorneys for the administration claimed in a court filing that the agency “anticipates exhausting its currently available funds in early 2026”, setting the stage for it to be dismantled. The CFPB is legally barred from seeking additional funds from the Federal Reserve, its typical source of funding, the attorneys suggested.

Donald Trump’s officials have tried persistently to close the agency, attempting to fire the vast majority of its workforce. These efforts sparked months of legal wrangling. The CFPB has returned more than $21bn to US consumers since it was set up, in the wake of the financial crisis, to shore up oversight of consumer financial firms.

The justice department’s office of legal counsel issued an opinion claiming the CFPB cannot draw money from the Fed currently, claiming the “combined earnings of the Federal Reserve System” refers to profits of the Fed, which has operated at a loss since 2022. Several federal judges have previously rejected that argument used by companies attempting to dismiss lawsuits brought by the agency, reported Politico.

Russell Vought, the White House office of management and budget director, said in October that he plans to shut down the agency, and that this would take up to three months. The claim was criticized by Democrats, given previous contrary statements from the administration, and court decisions blocking the agency from being shut down.

“These comments are particularly concerning given that a federal court has specifically blocked you from illegally shutting down the agency,” wrote Senate banking committee Democrats in a letter to Vought. “Your continued attempts to shutter the CFPB are illegal, and American families stand to pay the price.”

Vought has already suspended most of the agency’s work, as the full DC circuit court of appeals is deciding whether to take the case as a lower court order blocked the firings of about 90% of the agency’s staff.

The CFPB did not immediately respond to a request for comment.

Comment: Trump and Vought are determined to remove this consumer protection so that they can continue to game the financial system against the little guy. Anyone reading "1929" will immediately recognize the characters operating here.

Comments

  • CrashCrash
    Gilded Age. Great Gatsby Hallowe'en Parties while (at the time) Food Stamps were cut. And what about Medical costs? Conscience-less, evil lumps are in charge of the US gummint. I was just looking into Medicare options today, Part D for DRUGS. I now NEED some good drugs, to anesthetize myself. OK, a limit of $2,100 is imposed on out-of-pocket costs for COVERED drugs. But the two I need which the Plan conveniently does not include on its Formulary? It's their option to charge me $86 million, if they want to do that. It's just plain criminal that this junk is allowed to continue year after year. How stoopid is this country? Extremely.
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