Rise Economy v. Vought

In the months since he took over as Acting Director of the Consumer Financial Protection Bureau (CFPB), Defendant Russell Vought has stated clearly his desire to shutter the agency. This case challenges Acting Director Vought’s latest effort to do so—this time by starving the CFPB of the funds needed to carry out its consumer-protection mission.

The statute that established the CFPB, the Dodd-Frank Act, specifies that the CFPB is funded through the “combined earnings of the Federal Reserve System.” Defendants Vought and the CFPB now take the position that the Federal Reserve System only has “combined earnings” when the system is profitable under a novel metric that is defined nowhere in the statute and inconsistent with the overall statutory scheme. Building on that new position, they have asserted that the Federal Reserve System does not currently have any “earnings” to transfer to the CFPB and that Acting Director Vought is accordingly relieved of the obligation to request funding out of this statutory source of standing appropriations.

Representing Rise Economy, the Woodstock Institute, and the National Community Reinvestment Coalition, we filed suit to challenge the refusal to request funding from the Federal Reserve, as required by statute. The complaint explains that Mr. Vought is required by law to determine the amount “reasonably necessary” to carry out the CFPB’s responsibilities so that the Federal Reserve Board can transfer that amount to the CFPB. Mr. Vought also bases his refusal to request funds on a clear misreading of the statute providing funding to the CFPB from the Federal Reserve System’s earnings. The complaint seeks a declaration that Defendants’ refusal is unlawful and an order requiring Vought to request from the Federal Reserve the funding reasonably necessary to carry out the CFPB’s duties.