Despite the efforts of some business groups to abolish the Consumer Financial Protection Bureau (CFPB), the U.S. Supreme Court is standing in the way.
In a 7-2 ruling, some conservative justices joined their liberal colleagues and rejected arguments that the bureau’s funding is unconstitutional. Justice Clarence Thomas wrote the majority opinion. In his opinion, Thomas wrote that Congress has a lot of latitude in determining how government agencies are funded.
Conservative groups have been loudly critical of the bureau, established during the Obama administration, because it has imposed regulations on financial institutions, including the payday loan industry.
“For years, lawbreaking companies and Wall Street lobbyists have been scheming to defund essential consumer protection enforcement,” CFPB said in a statement. “The Supreme Court has rejected their radical theory that would have devastated the American financial markets. The Court repudiated the arguments of the payday loan lobby and made it clear that the CFPB is here to stay.”
The bureau said Congress created CFPB to be the primary federal watchdog protecting consumers from predatory and abusive practices in the financial sector. Since the CFPB opened its doors in 2011, the agency said it has delivered more than $20 billion in consumer relief to hundreds of millions of consumers and has handled more than 4 million consumer complaints.
“This ruling upholds the fact that the CFPB’s funding structure is not novel or unusual, but in fact an essential part of the nation’s financial regulatory system, providing stability and continuity for the agencies and the system as a whole," the CFPB statement concluded.
The agency said it would continue carrying out the consumer protection work Congress intended.