Attorney General Bonta files multistate court brief in defense of CFPB | California – DOJ

Auckland — California Attorney General Rob Bonta, as part of a coalition of 24 Attorneys General, filed a brief in favor of the Consumer Financial Protection Bureau (CFPB) in the U.S. Supreme Court. In their court brief, the Attorneys General supported the CFPB’s contention that the CFPB’s funding structure is constitutional, and that even if the court finds that the CFPB’s current funding structure is not constitutional, the court will not allow the CFPB to continue to do so. He argued that past and ongoing regulatory and enforcement actions should not be overridden. These regulations and enforcement actions cover all aspects of the consumer finance market. The incident in question is Consumer Financial Protection Bureau v. American Community Financial Services Association.

“The CFPB is a cornerstone of federal consumer financial protection and a key partner to state attorneys general.” said Attorney General Bonta.. “The stakes for consumer, state and financial market regulation are enormous. If left unchecked, the Fifth Circuit’s decision threatens to overturn more than a decade of enforcement and regulatory efforts by the CFPB. That would create havoc for consumers across the country.”

In 2018, a payday lending industry group challenged CFPB regulations prohibiting “unjust and abusive conduct or practices” related to the collection of payday loans and other loans. The regulation required lenders to disclose certain information to consumers before attempting to withdraw payments directly from the consumer’s bank account. The lawsuit went to the U.S. Court of Appeals for the Fifth Circuit, which ruled that the CFPB’s independent funding structure violated the appropriations clause, and therefore the rule was, or should be, repealed. I made some judgments.

The Attorney General emphasized in the court brief that:

  • The independent funding structure in which the CFPB receives funding from the Federal Reserve does not violate the appropriations provisions. Notably, the United States Court of Appeals for the Second Circuit recently agreed to this agreement. In addition, organizations such as the Federal Deposit Insurance Corporation (FDIC) and the National Credit Union also have independent funding structures.
  • Nullifying the CFPB’s past and ongoing enforcement actions as a result of appropriation violations directly contradicts court precedent. Even in the alleged lack of effective congressional spending, courts have not questioned the legitimacy of the underlying lawsuit itself.

Attorney General Bonta is a strong ally of the CFPB at every stage of the legal process. In December 2022, Attorney General Bonta, as a member of a coalition of 22 Attorneys General, asked the Federal Supreme Court to grant the agency’s petition for review. issued a statement following the verdict. Allow review.

Bonta joins the Attorneys General of New York, Arizona, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, North Carolina, Oregon, Pennsylvania and Rhode Island. . , Vermont, Washington, Wisconsin, and the District of Columbia submitted briefs.

A copy of the overview is available here.

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