Supreme Court to Hear Case on CFPB Funding, with Far-Reaching Implications for Financial Services Regulation

The Supreme Court has agreed to hear a case involving the Consumer Financial Protection Bureau (CFPB), a federal agency that protects consumers from unlawful financial services practices. The case was brought by business groups contesting a lower court ruling from last year that said the mechanism allowing the CFPB to be funded directly by the Federal Reserve is unconstitutional.

The Biden administration had asked the court to fast-track the case, but it will instead be decided in the court’s next term, which starts in October and ends in June 2024. The administration had argued that a lower court decision invalidating the way the CFPB is funded threatens its entire mission.

This case is the latest in a series of rulings from the conservative-dominated Supreme Court that have been diminishing regulatory control for consumer protection, public health and the environment. If the court rules in favor of the business groups, it could have a significant impact on the CFPB’s ability to protect consumers from unlawful financial services practices.

The Supreme Court’s decision to hear the case is a sign that it is taking the issue seriously. The outcome of the case could have far-reaching implications for the CFPB and the regulation of financial services in the US. The court’s ruling is expected to be issued in June 2024.