The Trump administration has ordered to halt the Consumer Financial Protection Bureau's operations, effectively closing down the organisation established to safeguard consumers following the 2008 financial crisis and subprime mortgage scandal.
Russell Vought, the recently appointed director of the Office of Management and Budget, instructed the CFPB to cease work on proposed regulations, suspend implementation dates for finalised but not yet effective rules, and halt all investigative activities.
The organisation, established by President Barack Obama in 2011 after the 2007-2008 financial crisis, has faced consistent opposition from conservative groups.
The directive specifically mandated the bureau to "cease all supervision and examination activity."
Additionally on Saturday evening, Vought announced via social media that the CFPB would discontinue obtaining funds from the Federal Reserve, stating that its current funding of $711.6 million is "excessive." The bureau's Federal Reserve funding structure was originally designed by Congress to protect it from political influence.
The recent email from Vought follows Treasury Secretary Scott Bessent's February 3 directive and represents another step by the Trump administration to swiftly reduce what they consider excessive federal agency operations.
The bureau, established by Obama following the 2007-2008 housing bubble and financial crisis that partly stemmed from fraudulent mortgage practices, was conceptualised by Massachusetts Democratic Sen. Elizabeth Warren. The organisation has faced opposition and legal challenges from major banks and financial sector associations.
According to Vought's email, President Donald Trump appointed him as acting director of the CFPB on Friday, following the dismissal of previous director Rohit Chopra on February 1.
The CFPB during Chopra's leadership implemented regulations to restrict overdraft fees by banks, reduce unnecessary charges, and proposed limitations on data brokers' ability to sell personal information, including Social Security numbers. The agency also addressed concerns about alleged discrimination against crypto firms and conservatives by attempting to prohibit contracts that could restrict financial services access based on political expressions.
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