The Consumer Financial Protection Bureau has formally rescinded its May 2022 interpretive rule that encouraged states to police an array of federal consumer‑finance statutes. In its place, a new interpretive rule says states may enforce only the Consumer Financial Protection Act (CFPA) itself, must observe the same entity‑specific limits that bind the Bureau, and should coordinate, not run parallel, cases with the CFPB.
Catch up fast: The prior rule told attorneys general they could sue any time a “covered person or service provider violates any of the Federal consumer financial laws,” and expressly blessed simultaneous state and Bureau actions. That reading opened the door for states to deploy the CFPA’s powerful “unfair, deceptive or abusive acts or practices” (UDAAP) standard and underlying laws like the FDCPA in collection cases even when the CFPB was already on the scene.
Then (2022 Rule) Now (2025 Rule) States may enforce any of the 18 federal consumer‑finance laws listed in the CFPA States may enforce only Title X itself—the CFPA and its implementing regulations CFPB’s entity‑specific carve‑outs (e.g., merchants, auto dealers) did not constrain states Sections 1027 & 1029 do apply to states; those carve‑outs remain States could pursue parallel cases while the CFPB litigated Bureau calls dual actions “wasteful” and says section 1042 envisions joint, not parallel, enforcement
What’s next:
- States’ playbook narrows: Attorneys general can still bring UDAAP cases, but only against entities that fall within the Bureau’s own jurisdictional lines.
- Other laws untouched: The rescission “is not altering, limiting, or affecting the authority of States to take any action authorized by any separate provision of State or Federal law,” the rule notes.
- Compliance takeaway: Collection agencies, debt buyers and servicers should revisit any multi‑state enforcement assumptions built on the 2022 guidance; future actions are more likely to be joint ventures with the CFPB than parallel proceedings.
- Regulatory pendulum swing: The rollback aligns with a wider effort by Acting Director Russell Vought to trim guidance seen as expanding CFPB reach. In the same week, the Bureau withdrew a proposed data‑broker rule and dozens of other guidance documents.
- Coordination still required: States must still provide the CFPB advance notice of any CFPA action so the Bureau can intervene.
