Consumer watchdog groups say the CFPB quietly dropped at least 21 enforcement actions, many against repeat offenders.
Agency plans to repeal the Open Banking Rule, a key consumer data protection, amid pressure from banks.
Critics say the moves favor Wall Street over consumers, weakening accountability and financial transparency.
The Consumer Financial Protection Bureau (CFPB), under the Trump Administration, is facing fierce criticism from consumer advocates and financial transparency groups following a string of recent actions that signal a dramatic retreat from enforcement and consumer rights protections.
A new memo from the Consumer Federation of America (CFA) and the Student Borrower Protection Center (SBPC) reveals that the CFPB has quietly dismissed at least 21 public enforcement actions, many involving repeat corporate offenders accused of serious financial wrongdoing. In some instances, the Bureau is also seeking to reverse or reduce penalties in previously settled cases, potentially depriving affected consumers of compensation they were legally promised.
“These moves, accompanied by the blatant corruption being encouraged by this administration, send a clear message: Lawbreaking is tolerated,” said Eric Halperin, former CFPB Enforcement Director, in a recent New York Times guest essay. He described the changes as a “sweeping rollback of accountability,” with major financial players now essentially being rewarded for their persistence in dodging justice.
Consumer advocates argue that these decisions threaten to erase decades of progress in protecting the public from financial abuse and deception. By backing off enforcement and rewriting already resolved cases, the CFPB under Trump and Acting Director Russ Vought is “memorializing corporate impunity,” according to the CFA-SBPC memo.
Open Banking Rule repeal draws battle lines
In a related development, the CFPB announced it will seek to repeal the Section 1033 Open Banking Rule, a key consumer data protection measure under the Dodd-Frank Act that would have empowered Americans to access and control their financial data.
The decision came via a status report filed in federal court, where the CFPB now claims the rule is “unlawful and should be set aside.” This follows a lawsuit by the Banking Policy Institute and the Kentucky Bankers Association, who argue that the CFPB overstepped its legal authority.
Consumer groups and fintech advocates were quick to condemn the reversal.
“Vacating the 1033 rule is a handout to Wall Street banks, who are trying to limit competition and debank Americans from digital financial services,” said Penny Lee, President and CEO of the Financial Technology Association.
While the CFPB has stated that it remains bound by Section 1033’s statutory mandate to provide consumers access to their financial data, it is unclear how—or if—the Trump Administration plans to implement those requirements going forward.
Meanwhile, banking lobbyists hailed the decision, warning that the rule would have “disrupted” the existing data-sharing ecosystem and handed too much power to tech firms.
A 'dangerous precedent'
Taken together, the enforcement rollbacks and regulatory repeals have sparked concern among advocates who warn that these actions could establish a dangerous precedent: large financial institutions may now feel emboldened to wait out regulatory oversight, confident that political winds will eventually blow in their favor.
“This is about more than just rules—it’s about trust, accountability, and the role of government in protecting people from predatory practices,” said one CFA representative. “Right now, the CFPB is siding with Wall Street over working families.”
With more decisions expected in the coming weeks, critics are calling on Congress and watchdog organizations to closely scrutinize the CFPB’s evolving priorities—and to hold leadership accountable for what they see as a betrayal of the Bureau’s founding mission.