Gutted CFPB to Pose Challenges for Trump’s Choice to Lead It

Brian Johnson, President Donald Trump’s pick to lead the Consumer Financial Protection Bureau, is likely to advocate for fintech-friendly policies and more enforcement actions against blatant fraudsters. But he’ll encounter hurdles advancing his agenda at an agency that the administration previously pushed to the brink of extinction.

Johnson, a credit card executive at Capital One Financial Corp. who served as the CFPB’s deputy director during the first Trump administration, has been critical of what he called the agency’s overreach under Biden-era Director Rohit Chopra, including a now-overturned proposal to bring the largest digital payment companies under the agency’s supervision.

During his previous stint at the CFPB, Johnson instead sought to work with fintechs developing new products, including through a “sandbox” program that Chopra later ended.

Johnson would likely push to restore the collaborative model he and former Director Kathleen Kraninger put in place during Trump’s first term, said Eric Mogilnicki, senior counsel at Covington & Burling LLP who has represented clients before the CFPB.

If confirmed, Johnson may also seek to resuscitate an enforcement program that’s gone largely dormant following acting Director Russell Vought’s repeated efforts over nearly 18 months to curtail the agency’s operations. The CFPB under Kraninger and Johnson brought a significant number of enforcement actions, even if large financial companies were mostly spared.

“I would expect enforcement against fraudsters, fostering innovation, and modernizing regulations to be priorities in a Johnson administration,” Mogilnicki said.

But with the CFPB’s staff dwindling, its funding slashed, and a potential Democratic takeover in at least one house of Congress next year, Johnson’s nomination may have come too late for him to make significant changes, said Adam Rust, the director of financial services at the Consumer Federation of America.

“To the extent his agenda could’ve been completed in 2025, Vought has made that much more difficult,” he said.

‘Mean Spirit’

Even if Johnson wants to bring back enforcement, rewrite rules, and work with fintechs, the CFPB Vought leaves behind may be too hobbled to accomplish much, said Joann Needleman, the leader of Clark Hill PLC’s financial services regulatory and compliance practice.

In a workforce reduction plan submitted in March to the US Court of Appeals for the District of Columbia Circuit, Vought proposed a headcount of about 500 staff members, down from around 1,100 people who currently work at the CFPB. The court is still considering the plan.

Many of those cuts will come in the CFPB’s enforcement and supervision units, potentially hindering any attempt by Johnson to leave his mark on the agency’s oversight efforts.

The CFPB has filed only one enforcement action—against failed banking-as-a-service company Synapse Financial Technologies Inc.—during Vought’s tenure. That enforcement action was intended to allow customers who saw millions of dollars frozen receive around $46 million in payments from the CFPB’s civil penalty fund, although the agency is still working to distribute the payments.

The CFPB under Vought has also voluntarily dismissed more than 20 lawsuits against companies such as JPMorgan Chase & Co., Wells Fargo & Co., and Johnson’s Capital One, and terminated over a dozen administrative actions early.

Vought has also removed thousands of documents from the CFPB’s website and taken other steps to tear down the agency, Needleman said.

“They’re just not being productive, and there is a mean spirit to it, for sure,” she said.

All of those moves will make it harder for Johnson to move forward with his plans, Needleman said.

Narrower Focus

Given the Senate calendar, Johnson is unlikely to get a confirmation vote until the fall, TD Cowen managing director Jaret Seiberg said in a June 10 client note.

If confirmed, “Johnson will focus on what Congress required the agency to do rather than using it as a platform to advance a broader agenda,” Seiberg said.

That means fintechs such as earned-wage access providers and buy now, pay later companies that faced CFPB scrutiny under Chopra are likely to see a lighter hand, he said.

Johnson has advocated for a constrained CFPB since leaving the agency.

“Much like Wile E. Coyote over the Grand Canyon, allowing bureaucrats to dictate prices and acceptable risk levels, as opposed to allowing markets to discover and price them, only works for so long; at some point you have to look down, and it makes the pain of the fall that much worse,” Johnson, then a managing director at Patomak Global Partners, told House lawmakers in March 2024.

But following the Trump administration’s repeated attempts to shutter the CFPB, prompting hundreds of employees to leave, Johnson may find he has few tools left to reshape the agency.

“What can be done once Vought is done?” Rust said. “What will Vought leave on the table resource-wise for Johnson?”