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U.S. Supreme Court Rejects Challenge to CFPB Funding Structure

The Supreme Court upheld the CFPB, rejecting a challenge to the bureau’s funding structure in a 7-2 ruling today. This decision overturned a lower court’s ruling and affirmed the constitutionality of the agency’s funding mechanism. The CFPB, established in response to the 2008 financial crisis, regulates consumer finance, including mortgages and car loans. The case was brought by payday lenders who argued against a CFPB rule. The agency’s funding, which bypasses the annual congressional budget process and is instead directly provided by the Federal Reserve, was deemed constitutional by the Court. This decision is significant amid ongoing challenges to CFPB rulemaking by industries it regulates, including credit unions.

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