Supreme Court: CFPB funding doesn't violate Constitution
Court Alerts
The Supreme Court on Thursday rejected a conservative-led attack that could have undermined the Consumer Financial Protection Bureau.
The justices ruled 7-2 that the way the CFPB is funded does not violate the Constitution, reversing a lower court and drawing praises from consumers. Justice Clarence Thomas wrote the majority opinion, splitting with his frequent allies, Justices Samuel Alito and Neil Gorsuch, who dissented.
The CFPB was created after the 2008 financial crisis to regulate mortgages, car loans and other consumer finance. The case was brought by payday lenders who object to a bureau rule that limits their ability to withdraw funds directly from borrowers’ bank accounts. It’s among several major challenges to federal regulatory agencies on the docket this term for a court that has for more than a decade been open to limits on their operations.
The CFPB, the brainchild of Democratic Sen. Elizabeth Warren of Massachusetts, has long been opposed by Republicans and their financial backers. The bureau says it has returned $19 billion to consumers since its creation.
Outside the Supreme Court following the decision, Warren said, “The Supreme Court followed the law, and the CFPB is here to stay.”
President Joe Biden, a fellow Democrat who has taken steps to strengthen the bureau, called the ruling “an unmistakable win for American consumers.”
Unlike most federal agencies, the consumer bureau does not rely on the annual budget process in Congress. Instead, it is funded directly by the Federal Reserve, with a current annual limit of around $600 million.
The federal appeals court in New Orleans, in a novel ruling, held that the funding violated the Constitution’s appropriations clause because it improperly shields the CFPB from congressional supervision.
Related listings
-
Court will decide if Trump has immunity in election interference case
Court Alerts 04/23/2024Supreme Court arguments have begun over whether former President Donald Trump can avoid prosecution over his efforts to overturn his 2020 election loss to Democrat Joe Biden.The justices on Thursday took up for the first time whether a former preside...
-
Court questions obstruction charges brought against Jan. 6 rioters and Trump
Court Alerts 04/17/2024The Supreme Court on Tuesday questioned whether federal prosecutors went too far in bringing obstruction charges against hundreds of participants in the Jan. 6, 2021, Capitol riot. But it wasn’t clear how the justices would rule in a case that ...
-
What to know about abortion in Arizona under the near-total 1864 ban
Court Alerts 04/12/2024The Arizona Supreme Court gave the go-ahead Tuesday to prepare to enforce a long-dormant law that bans nearly all abortions, drastically altering the legal landscape for terminating pregnancies in a state likely to have a key role in the presidential...
New York Commercial Litigation Law Firm - Woods Lonergan PLLC
Founded in 1993 by Managing Partner James F. Woods, Woods Lonergan PLLC has built a strong reputation as a resourceful and industrious firm that provides clients with clear, concise, and straightforward answers to their most challenging legal issues. Partner Lawrence R. Lonergan, who joined the firm in 2008, has been a friend and colleague to Mr. Woods for over 40 years and shares the same business philosophy. Woods Lonergan PLLC’s collective experience and expertise enables the firm to expeditiously and effectively analyze the increasing challenges clients face in an evolving business and legal world, in many instances, avoiding unnecessary time and expense to our clients. Our mission is simple: provide cutting-edge expertise and sound advice in select areas of the law for corporate and business clients. We thrive on providing each client with personalized attention, forceful representation, and a collaborative team effort that embraces collective knowledge.