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2w ago

Judge Orders Trump Administration to Keep CFPB Funded Through Federal Reserve

The ruling rejects a DOJ legal theory about the Fed’s “combined earnings,” stabilizing the agency’s operations during ongoing appeals.

FILE - A security officer works inside of the Consumer Financial Protection Bureau (CFPB) building headquarters Monday, Feb. 10, 2025, in Washington. (AP Photo/Jacquelyn Martin, File)
The Federal Reserve Chair logo appears on a podium at the Federal Reserve, Wednesday, Dec. 10, 2025, in Washington. (AP Photo/Jacquelyn Martin)
FILE - Director of the Office of Management and Budget Russell Vought speaks to reporters at the White House, Thursday, July 24, 2025, in Washington. (AP Photo/Julia Demaree Nikhinson, File)
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Overview

  • U.S. District Judge Amy Berman Jackson said the administration must continue requesting transfers from the Federal Reserve, finding no legal bar to funding.
  • She characterized the Office of Legal Counsel memo as a manufactured pretext that would violate her prior injunction against dismantling the bureau.
  • The order averts an immediate cash shortfall that officials warned could leave the CFPB unable to pay staff in early 2026.
  • Jackson clarified that Dodd‑Frank requires the bureau to draw from the Fed’s combined earnings even when the central bank reports losses.
  • The D.C. Circuit will rehear the broader dispute in early 2026, and a coalition of 21 states and the District of Columbia has separately sued to block defunding after the Supreme Court earlier upheld the CFPB’s funding structure.