The Supreme Court has rejected a challenge from the payday loan industry to the Consumer Financial Protection Bureau (CFPB). This decision ensures the CFPB can continue to protect consumers from predatory lending practices.
The CFPB was created in 2010 to prevent the kind of lending that led to the 2008 financial crisis. The agency has helped consumers by providing $19 billion in relief, including a $3.7 billion settlement with Wells Fargo in 2022.
The payday loan industry had argued that the CFPB’s funding mechanism was unconstitutional. However, the Supreme Court ruled 7-2 that the CFPB’s funding design is legal and complies with the Constitution.
The CFPB is an important agency that helps regulate consumer financial products and services. This decision is a victory for the Biden administration and a setback for conservative critics who have sought to limit the agency’s power.
The Supreme Court’s decision ensures that the CFPB can continue to operate independently and effectively regulate the financial industry to protect consumers.
