Attorney General Clark Sues Trump Administration to Defend the Consumer Financial Protection Bureau

Attorney General Charity Clark today joined a coalition of attorneys general in suing the Trump Administration to stop the complete defunding of the Consumer Financial Protection Bureau (CFPB), which has returned more than $21 billion improperly taken from over 205 million Americans throughout its 14-year existence. The CFPB's current acting director, Russel Vought, is attempting to completely defund the agency by refusing to request any funding from the Federal Reserve, which will virtually guarantee the agency runs out of money in January 2026.

As Attorney General Clark and the coalition argue in their lawsuit, defunding the CFPB will have devastating impacts on consumers and severely disrupt states' consumer protection abilities, which rely on consumer complaints and data from the agency. The coalition argues that the CFPB has a legal requirement to collect and process consumer complaints and share that complaint data with states, and that Director Vought's actions violate the law and the Constitution. The Trump Administration's attempt to unilaterally defund the CFPB also violates the Administrative Procedure Act and the constitutional Separation of Powers by subverting Congress' clear instruction that the CFPB must regularly receive funding from the Federal Reserve. The lawsuit seeks a court order preventing the Administration from completely defunding the CFPB.

"Defunding the CFPB will only benefit the bad actors who prey on consumers and scam Americans out of their hard-earned money," said Attorney General Clark. "What the Administration is seeking to do is unlawful and will harm consumers. Considering the CFPB was established in the wake of the financial crisis, you don't have to go far to see the pitfalls of stripping consumers of this protection."

Established in the wake of the Great Recession, the CFPB is an independent agency funded entirely by the Federal Reserve and is focused on regulating financial institutions and products to protect consumers. The CFPB writes and enforces rules to regulate financial institutions, collects critical economic data, and fields millions of consumer complaints every year. In addition, the CFPB is the only federal agency authorized to supervise the nation's largest banks for their compliance with consumer financial protection laws.

Beyond its own consumer protection actions, the CFPB is legally mandated to provide vital information to states to aid their own consumer protection efforts. States rely on consumer complaints from the CFPB to investigate wrongdoing, secure refunds and restitution for consumers, and support their own litigation against financial institutions. States also regularly refer consumer complaints to the CFPB for further assistance. Defunding the CFPB will eliminate this important resource for resolving complaints and securing justice for cheated consumers.

Joining Attorney General Clark in filing this lawsuit are the attorneys general of Arizona, California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, New York, North Carolina, Oregon, Rhode Island, Wisconsin, and the District of Columbia.

A copy of the complaint is available on our website.

Today's lawsuit is the 39th case Attorney General Clark has brought against the Trump Administration since President Trump took office in January. For more information on actions taken by the Attorney General on behalf of Vermonters, visit our website at https://ago.vermont.gov/ago-actions.