WASHINGTON (AP) — The Supreme Court said Monday it will take up a Republican-led challenge to the Consumer Financial Protection Bureau, a case that could threaten how the consumer watchdog agency functions. It is the second time in three years that the justices will be examining the federal agency, which was created in the wake of the 2008 financial crisis.
The case will not be heard before October. That’s when the court begins its next term.
Late last year, a federal appeals court — the U.S. Court of Appeals for the 5th Circuit — ruled that the agency’s funding structure is unconstitutional, threatening its ability to function. The Biden administration asked the high court to review that decision, which it has now agreed to do.
The administration said the lower court’s ruling “calls into question virtually every action the CFPB has taken” since its creation. The decision “threatens to inflict immense legal and practical harms on the CFPB, consumers, and the nation’s financial sector,” the administration said.
Since the bureau was created more than a decade ago by the Dodd-Frank Act, it has varied in its aggressiveness. During the Obama administration, it used its muscle to collect fines from banks and credit card companies; during the Trump administration, it drastically scaled back enforcement actions. Republicans have argued that the agency has unchecked power.