Court Rules Trump Administration Must Fund CFPB

A federal district court has ruled that the Trump administration is legally required to continue securing funding for the Consumer Financial Protection Bureau (CFPB) and cannot allow its funding to lapse.​

What the ruling says

• U.S. District Judge Amy Berman Jackson held that the administration must keep seeking money for the CFPB from the Federal Reserve and that stopping funding would violate an existing injunction that bars efforts to dismantle or shut down the agency while litigation is pending.​

• The judge rejected the administration’s argument that it was “legally barred” from funding the CFPB because the Federal Reserve has been operating at a loss, calling that rationale a legally baseless pretext.​

Why CFPB funding was at risk

• The Trump administration had relied on an Office of Legal Counsel theory that the Federal Reserve could not provide CFPB funds while it had negative net income, and officials therefore declined to request new transfers.​

• As a result, the CFPB warned it could run out of cash around late 2025 or early 2026, threatening staff pay and core operations such as consumer complaint handling and supervision of financial firms.​

Legal and practical impact

• The order clarifies that the prior injunction obligates the government not just to avoid formally abolishing the CFPB, but also to take the affirmative steps needed to keep it functioning, including requesting funds from the Federal Reserve.​

• The ruling preserves day‑to‑day operations at an agency that has secured tens of billions of dollars in relief for consumers, but it does not end broader political and legal battles over the CFPB’s structure and future.​

Connection to earlier Supreme Court decision

• Earlier in 2025, the Supreme Court upheld the CFPB’s basic funding model—drawing money from the Federal Reserve rather than annual congressional appropriations—as consistent with the Constitution’s appropriations requirement.​

• That Supreme Court ruling closed one line of attack on the CFPB’s legality, while the new district court decision blocks a separate attempt to weaken the agency indirectly by starving it of funds.​