The Trump administration, led by Acting CFPB Director Russ Vought, has been working diligently to unravel the Consumer Financial Protection Bureau (CFPB), a brainchild of progressive Sen. Elizabeth Warren (D-MA).
“The CFPB has been a woke & weaponized agency against disfavored industries and individuals for a long time. This must end,” Russ Vought, the Office of Management and Budget (OMB) Director and Acting Director of the CFPB, wrote in February.
The Trump Big Beautiful Bill cut the funding of the CFPB (which receives funding through the Federal Reserve, rather than the typical congressional appropriations process) by roughly half.
The Trump administration, OMB and CFPB teams have worked to unwind the CFPB’s ability to attack American businesses by engaging in “regulation by enforcement.”
Mark Paoletta, chief legal officer for the CFPB, told Breitbart News, “The most important thing that we should be doing right now for liberty, the rule of law, consumers, and the business of America is to shut down these cases.”
Paoletta said that Vought came into the CFPB “to actually take on the internal swamp of the enforcement team.”
The Trump administration has viewed many of the CFPB’s actions as “regulation by enforcement,” which they have worked to stop by shutting down more than 30 enforcement actions initiated by the CFPB.
In one notable instance, the CFPB closed a Biden-era investigation against Credova, a subsidiary of Public Square that provides consumer financing for firearms, believing it was another example of weaponization of government that the Trump administration aims to end.
Paoletta said he was “appalled” to learn how “plainly politically motivated” the Bureau’s actions were, as the “Bureau ratcheted up its settlement demands, via a proposed consent decree” the same day that Donald Trump Jr. joined Public Square’s Board of Directors.
The CFPB dropped a case against Walmart and Branch Messenger over issues with contracted delivery drivers allegedly not receiving pay the same day. Walmart and Branch Messenger have denied these accusations.
“We are pleased with the decision to dismiss the case. As we said from the start, the CFPB’s rushed lawsuit was riddled with factual errors and misguided claims. It should never have been filed in the first place,” a Walmart spokesperson said in May.
In another case, the Trump CFPB dismissed a case against Navy Federal Credit Union after the Biden administration accused the nation’s largest credit union of unfair and deceptive overdraft fee practices.
“Navy Federal’s commitment to prioritize and protect our members is core to who we are. Our overdraft program allows our members to make necessary, everyday purchases without going into long-term debt or turning to payday lenders,” Navy Federal said in a July statement. “Navy Federal complied with all applicable laws and regulations at the time and continues to do so. We firmly believe the CFPB’s decision to terminate the order was appropriate.”
Beyond stopping onerous regulation by enforcement through the CFPB, the Trump administration reduced the travel budget for the agency from $10 million to $1 million.
The Trump administration has moved to enact mass layoffs at the consumer regulatory agency. A federal appeals court recently ruled that the CFPB can lay off the majority of its employees, which would mean more than 1,400 staffers.
Moving forward, the CFPB sees itself pulling down as many regulations as possible and eliminating onerous reporting requirements to the agency so that businesses can focus on providing value to their customers.
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