CFPB Is In Existential Crisis — And Covered Parties Have A Unique Opportunity

Due to a Fifth Circuit decision striking down the Consumer Financial Protection Bureau's (CFPB) Payday Lending Rule promulgated in 2017 - in a case known as Community Financial Services Association of America, Limited v. CFPB- the Bureau's very existence is in peril.

Some of the key takeaways from this decision are:

• CFPB's funding structure violates the Constitution's Appropriations Clause.
• There was a "linear nexus" between the unconstitutional funding mechanism and the challenged CFPB action - in this case, a rule promulgated by the Bureau.
• That nexus applies to all CFPB actions resultant from the CFPB's funding, including the rules it promulgates, the investigations it conducts, and the decisions it makes.