Federal Appeals Court Pauses Lower Court’s Order on CFPB
A federal appeals court reportedly paused a lower court’s order from last week that reversed President Donald Trump’s actions at the Consumer Financial Protection Bureau (CFPB).
At the same time, the appeals court’s ruling left in place provisional agreements that block the Trump administration’s efforts to fire staff or cancel contracts, Reuters reported Thursday (April 3).
The appeals court said the pause would be temporary and would give it time to consider a Justice Department request that the order be put on hold while government lawyers try to have it reversed, according to the report.
Justice Department lawyers said Saturday (March 29) that they plan to file an appeal against the Friday (March 28) order, which required the CFPB to not delete data, to reinstate fired workers and to allow them to resume their work, the report said.
The Justice Department’s claim marked another move in an on-again, off-again saga that has seen the CFPB seemingly gain a new lease on life after a series of efforts to dismantle it, PYMNTS reported Monday (March 31).
Since the appointment of acting CFPB Director Russell Vought, the agency has seen a directive to halt legislation, supervisory activities and the overhaul of the CFPB’s digital presence, coupled with plans for mass firings and the termination of contracts.
The court that ordered the preservation of the CFPB’s status quo said this rapid sequence of events is evidence of an intent to “totally eliminate” the agency.
The CFPB was also the subject of debate in a March 26 House hearing in which critics of the agency said it needs a restructuring and has engaged in what they called “regulatory overreach” that merits a revisiting of its funding structure as well.
The hearing before the House Subcommittee on Financial Institutions was titled “A New Era for the CFPB: Balancing Power and Reprioritizing Consumer Protections.”
When the Trump administration’s nominee to lead the CFPB, Jonathan McKernan, appeared before the Senate Banking Committee on Feb. 26, he told lawmakers, “All too often, … the CFPB has gotten in the way of its own mission.”
“It has acted in a politicized manner,” McKernan said.
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