Attorney General Bonta Celebrates Final Win in CFPB Funding Lawsuit, Consumer Protection Agency Must Remain Lawfully Funded
Court calls federal government’s attempt to starve CFPB of funding a “transparent display of partisanship”
OAKLAND — California Attorney General Rob Bonta today celebrated a decision by the U.S. District Court for the District of Oregon, holding that the Consumer Financial Protection Bureau (CFPB) Acting Director Mark Paoletta must request necessary funding from the Federal Reserve so the CFPB can operate as Congress intended — lawfully funded and able to work so consumers have access to fair, transparent, and competitive markets for consumer financial products. The court held that former Acting Director Russell Vought’s insistence not to request funds for the CFPB were unlawful and violated the Separation of Powers Clause in the U.S. Constitution. Today’s order resolves in large part the lawsuit filed last year by Attorney General Bonta and a coalition of 22 attorneys general, pending appeal.
“Today, we celebrate a giant win for consumers. A court has declared that the federal government’s attempt to refuse to fund the CFPB — the agency responsible for protecting consumers from unfair, deceptive, and abusive acts by Big Corporations — is an illegal, unconstitutional, and partisan attempt to starve the CFPB of lawful funding,” said Attorney General Bonta. “The CFPB is a critical resource for families and working Americans and has worked for over a decade to stand up for consumers taken advantage of by big banks, debt collectors, and credit reporting companies. The order we secured today demands the agency continue to be lawfully funded in order to keep up this important work, and halts the federal government from playing games with the financial protection of consumers in the future. Especially amid a crisis of affordability, today’s win is great news for families across the United States.”
The CFPB was created to protect consumers in the financial marketplace, and it performs critical functions necessary to the functioning of the financial system. For 14 years, the CFPB has served as an invaluable partner to state attorneys general and state banking regulators, as an enforcer, regulator, and resource for consumers. Shortly after taking office, the Trump Administration launched a campaign of destruction and systemic shuttering of the CFPB, threatening catastrophic harm to hardworking families and consumer financial markets nationwide.
The Trump Administration has taken a series of actions intended to debilitate the CFPB, including issuing a suspension of work across the agency, terminating probationary employees, attempting to issue reduction in force notices to 90% of the CFPB’s workforce — a move that was swiftly blocked by the courts.
In November 2025, the CFPB gave notice that it would not request funding from the Federal Reserve to continue its operations based on a specious legal analysis it had received from U.S. DOJ advising that it could not lawfully draw funds from the Federal Reserve to maintain its operations because the Federal Reserve is “unprofitable.” In December 2025, Attorney General Rob Bonta co-led a coalition of 22 attorneys general in filing a lawsuit challenging the CFPB Acting Director’s unlawful decision not to fund the agency’s operations, preventing it from performing legally mandated functions.
In the lawsuit, the attorneys general argued that CFPB’s failure to seek funding for continued operations, including operations of its consumer complaints database, would harm consumers and result in statutorily mandated functions not being performed. The attorneys general asked the court to declare this action unlawful and ensure CFPB is properly funded, and today, it has.
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