The Supreme Court will decide a case that challenges the way Congress chose to fund the Consumer Financial Protection Bureau, a watchdog agency set up as a key part of the response to the 2008 financial crisis.
The Biden administration appealed a lower court ruling from October that found CFPB’s funding model unconstitutional. To make sure the CFPB would be independent, Congress put the agency outside the appropriations process and instead gave it automatic funding from the Federal Reserve. The U.S. Court of Appeals for the 5th Circuit ruled that violated the Appropriations Clause of the Constitution, a ruling the Biden administration called “unprecedented and erroneous” in a Supreme Court petition less than a month later.
That ruling, the Biden administration said, calls into question “virtually every action” taken by the agency since its creation in the 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act. The agency aims to enforce consumer financial statutes and protect consumers against “unfair, deceptive, or abusive practices.”
