Baltimore Drops CFPB Funding Lawsuit

Last week, the city of Baltimore voluntarily dropped its lawsuit challenging the Trump administration’s efforts to defund the Consumer Financial Protection Bureau (CFPB). The city is represented by Democracy Forward, a left leaning organization, and cited the government’s position in court that it will not transfer money from its reserve fund to defund the CFPB as its reason for dismissing the case.

“Defendants have repeatedly represented that there is no mechanism by which Defendant Consumer Financial Protection Bureau can transfer away money from, or otherwise relinquish control over the money in, the Bureau Fund,” lawyer Mark Samburg wrote in the filing, according to The Hill. CFPB CFO Ngagne Jafnar and COO Adam Martinez both noted such a transfer would not be possible.

In February, consumer advocates, led by the Economic Action Maryland Fund, sued the CFPB, less than a week after acting Director Russ Vought wrote that the Bureau would not take any unappropriated funding. Jafnar argued that if the Bureau were to reduce its reserve fund, it would only make more funding available for the CFPB to start using, according to Banking Dive.

Additionally, the National Treasury Employees Union sued the CFPB in federal court in Washington, D.C. to stop the Trump Administration’s plans to fire up to 95 percent of the Bureau’s workforce. Baltimore’s dismissal also comes without prejudice, so plaintiffs can sue the CFPB again on similar grounds.

“If Defendants later transfer Bureau funds in contradiction of their repeated representations about their lawful authorities, abilities, and intent, Plaintiffs will undertake further actions as appropriate,” the consumer advocates told the court.