CFPB Funding Case Raises Worries for Other Banking Regulators

The Supreme Court’s pending review on whether the Consumer Financial Protection Bureau’s funding stream is unconstitutional is fanning concerns about other financial regulators’ ability to cover their costs.

The US Court of Appeals for the Fifth Circuit in October ruled that the CFPB’s funding through the Federal Reserve—outside the congressional appropriations process—violated the Constitution.

The ruling sought to distinguish between the CFPB’s direct funding and how other financial regulatory agencies—such as the National Credit Union Administration (NCUA) and the Office of the Comptroller of the Currency (OCC)—are funded, primarily through fees charged to the banks and credit unions they regulate. ...