Washington, D.C. — In response to a brief filed by the United States Solicitor General in support of the Consumer Financial Protection Bureau in CFPB v CFSA, a case challenging the constitutionality of the CFPB’s funding structure, the American Economic Liberties Project released the following statement.

“Today should dispel any lingering fantasy that the CFPB’s funding structure is unconstitutional. The Solicitor General’s brief rejects the baseless arguments of payday lenders and their lobbyists and exposes the Fifth Circuit’s decision for what it is: unprecedented in nature, unfounded in fact, and entirely unanchored in any understanding of the law,” said Morgan Harper, Director of Policy and Advocacy at the American Economic Liberties Project. “The Supreme Court must move swiftly to overturn the Fifth Circuit’s dangerous opinion and let the CFPB focus on its critical job of protecting working Americans and small businesses from predatory financial firms like those CFSA represents.”

Congress established the CFPB in the wake of the 2008 financial crisis to protect Americans from abuse in the consumer financial industry, expressly authorizing the agency to draw a limited budget from the Federal Reserve System. In 2022, the Fifth Circuit Court of Appeals struck down a CFPB rule protecting borrowers from abusive payday lenders, citing its unconstitutional funding structure, a structure it shares with the Federal Reserve and numerous other federal agencies — a decision later rejected by its sister court on the Second Circuit.

If not overturned by the Supreme Court, the Fifth Circuit’s ruling against the CFPB would sow chaos in financial markets and void countless actions taken by the CFPB to fight wrongdoing by powerful corporate giants like big banks, credit card firms, and credit reporting companies, which have so far resulted in more than $16 billion returned to Americans. Beyond the CFPB, the Fifth Circuit’s ruling threatens the nation’s economic stability, jeopardizing the constitutionality of the Federal Reserve – the linchpin of the entire global economy – as well as other key financial agencies. The ruling could also make nearly two-thirds of federal spending illegal, including health care, retirement, and food assistance benefits, dismantling critical parts of the U.S. state relied upon by the American people.

Learn more about Economic Liberties here.

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The American Economic Liberties Project works to ensure America’s system of commerce is structured to advance, rather than undermine, economic liberty, fair commerce, and a secure, inclusive democracy. Economic Liberties believes true economic liberty means entrepreneurs and businesses large and small succeed on the merits of their ideas and hard work; commerce empowers consumers, workers, farmers, and engineers instead of subjecting them to discrimination and abuse from financiers and monopolists; foreign trade arrangements support domestic security and democracy; and wealth is broadly distributed to support equitable political power.