Supreme Court Schedules Arguments in CFPB Constitutionality Case for October
The Supreme Court recently announced its October argument calendar—the first month of the court’s next annual term—which includes the case involving the constitutionality of the Consumer Financial Protection Bureau (CFPB)’s funding mechanism. According to The Hill, decisions for the case are not expected until summer 2024.
On October 3, the Supreme Court is scheduled to hear the case. The Bureau currently receives up to a maximum amount of funding every year from the Federal Reserve’s earnings. Justices will decide if that setup is unconstitutional, as it bypasses Congress’s power of the purse.
The CFPB’s case began when two associations challenged the agency’s payday lending rule that restricted how payday lenders can try to collect on a loan. According to the Justice Department, ruling in the associations’ favor would also call into question nearly every other action the CFPB has taken since it was created in 2008 as part of the Dodd-Frank Act to protect consumers.
The case has garnered attention from attorneys general from all 50 states. The 27 Republican state attorneys general are in support of the challenge, while the 23 Democratic state attorneys general—and Washington D.C.—are supporting the Justice Department.
In October, the Fifth Circuit Court of Appeals ruled that the CFPB’s funding mechanism was unconstitutional, which the government appealed. The court announced its decision to hear the case earlier this year.
The Supreme Court will hear five other cases in October, including arguments over whether South Carolina’s congressional map needs to be redrawn.