SCOTUS upholds CFPB and Black Majority District in Louisiana

By Ivan Sanchez  In a significant ruling, the United States Supreme Court (SCOTUS) upheld the constitutionality of the Consumer Financial Protection Bureau’s (CFPB) funding mechanism, affirming Congress’s authority to designate funding sources for federal agencies. This same week they also upheld Louisiana’s Second Majority-Black congressional district for this election cycle in an unsigned opinion. Consumer Financial Protection Bureau v. Community Financial Services Association of America, Ltd., centered on the Appropriations Clause of the Constitution, which grants Congress control over public spending. The clause stipulates that funds can only be drawn from the Treasury “in Consequence of Appropriations made by Law.” For most federal agencies, funding is provided through annual appropriations approved by Congress. However, the CFPB operates differently, with Congress granting it a standing source of funding outside the typical appropriations process. Specifically, the Bureau is authorized to draw funds from the Federal Reserve System, subject to an inflation-adjusted cap, to carry out its duties and responsibilities. The Consumer Financial Protection Bureau, established in the wake of the 2008 financial crisis, serves as an independent agency tasked with protecting consumers in the financial marketplace. Its primary responsibilities include enforcing financial regulations, consumer education and advocacy, and handling consumer complaints.& In...