Twenty-one state and district attorneys general filed a lawsuit against Office of Management and Budget Director Russell Vought on Monday, opposing his moves to shutter the Consumer Financial Protection Bureau.
Vought, who is also serving as acting director of the CFPB, has been trying to dismantle the consumer watchdog since February. His efforts — including attempts to fire 90 percent of the agency’s staff — have been put on hold by a district court ruling. Vought has also argued in court that it would be illegal for him to request funding from the Federal Reserve, the CFPB’s main source of funding, when the U.S. central bank is not running a profit. The bureau is expected to run out of funds sometime in the next month.
The lawsuit, filed in the federal district court of Oregon, argues that Vought’s refusal to request funding is unlawful. It also alleges that Vought’s efforts to shutter the agency clash with the CFPB’s statutory duty to cooperate with states to respond to consumers’ issues. The CFPB maintains a database of consumer complaints, and it coordinates with state and district attorneys general to take enforcement actions against financial institutions found in violation of its rules. In 2024, the database led to $93 million in restitutions for consumers, according to the bureau.
“My office and attorneys general across the country rely on the CFPB for consumer complaints and other data to get justice for consumers,” said New York Attorney General Letitia James, one of the state attorneys general that brought the suit. “The administration’s actions are a handout to those who drive up costs by cheating hardworking Americans.”
James is joined by the attorneys general in Arizona, California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, North Carolina, Oregon, Rhode Island, Vermont, Wisconsin, and the District of Columbia — all Democrats.
In August, a 3-judge panel in the U.S. Court of Appeals cleared the way for the Trump administration and Vought to push ahead with their efforts to shut down the bureau, but put in place a stay until a higher court weighed in. Last week, the D.C. Court of Appeals agreed to hear the case en banc, a rare move which implies that many of the judges on the 11-person bench took issue with the lower court’s ruling. The case will be heard in late February.
Since the start of that suit, the Federal Reserve board has returned to profitability — undermining one of the administration’s main arguments. A number of current and former members of Congress and multiple former members of the Federal Reserve have filed amicus briefs pointing out the change.
