The Consumer Financial Protection Bureau is preparing to transfer all remaining enforcement cases and regulatory litigation to the Department of Justice as it warns staff it will run out of money at the end of the year, according to multiple reports and individuals familiar with the agency’s plans.
The move marks one of the most significant steps yet in the Trump administration’s effort to wind down the CFPB, which has been operating under severe financial strain since the White House refused to authorize additional funding from the Federal Reserve. Agency leaders told staff this month they expect furloughs to begin on December 31.
Why it matters:
- The CFPB is the only federal agency empowered to enforce consumer financial laws.
- A DOJ takeover introduces uncertainty around how aggressively those laws will be enforced.
- Active CFPB scrutiny of collectors, furnishers, lenders, fintechs, and credit reporting companies may slow, pause, or shift in strategy.
- Pending cases involving major industry players, including Experian, could face delays or dismissals.
What‘s happening:
- The Bureau has already dismissed more than 20 enforcement matters this year. Only a small number of active cases remain.
- Those final cases, along with appellate matters and litigation over CFPB regulations, including a challenge to its open banking rule, will now move to the DOJ.
- A newly formed Enforcement and Affirmative Litigation Branch inside DOJ’s Civil Division is expected to absorb the CFPB’s work.
- Internal messages indicate more than 1,000 CFPB employees could be furloughed if funding expires.
What they said: The transition has sparked backlash from lawmakers and staff:
- Sen. Elizabeth Warren [D-Mass.] called the action “the latest illegal power grab,” accusing the administration of trying to shut down the agency while telling courts they are not.
- The CFPB’s labor union said attorneys fear DOJ will dismiss ongoing cases, undermining protections for consumers and reducing accountability for financial firms.
What’s unclear:
- Whether DOJ will continue, narrow, or abandon ongoing enforcement actions.
- How the move affects future supervision, investigations, and civil investigative demands.
- Whether courts will intervene to halt the shutdown of the federally mandated watchdog.
