Supreme Court rejects challenge to CFPB

Consumer Financial Protection Burearu — President Joe Biden called the ruling an "unmistakable win" for consumers

(Image credit: Ting Shen / Bloomberg via Getty Images)

What happened

The Supreme Court ruled 7-2 on Thursday that the Consumer Financial Protection Bureau's funding mechanism is constitutional, rejecting the latest conservative-backed challenge to the agency. Justice Clarence Thomas wrote the majority opinion, while fellow conservative Justices Samuel Alito and Neil Gorsuch dissented. The ruling overturned a U.S. Fifth Circuit Court of Appeals decision.

Who said what

"The Supreme Court followed the law, and the CFPB is here to stay," said Sen. Elizabeth Warren (D-Mass.), who helped create the agency after the 2008 financial crisis. President Joe Biden called the ruling an "unmistakable win" for consumers. Lawyer Chris Vergonis said his payday lender clients still believe the CFPB rule limiting how much they can withdraw money from borrowers' bank accounts is "legally flawed."

What next?

The ruling put the CFPB's "existential threats to bed," but it still faces "the trench warfare of fighting the industry rule by rule," said regulatory lawyer Graham Steele. The Supreme Court is "expected to rule on two other major challenges to agency power" in coming weeks, The New York Times said.

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Peter has worked as a news and culture writer and editor at The Week since the site's launch in 2008. He covers politics, world affairs, religion and cultural currents. His journalism career began as a copy editor at a financial newswire and has included editorial positions at The New York Times Magazine, Facts on File, and Oregon State University.