Under the leadership of Rohit Chopra, the Consumer Financial Protection Bureau (CFPB) is lashing out with desperate, partisan overreach in its final days before the Biden administration exits. Facing imminent leadership changes under the incoming Trump administration, Chopra appears to be acting as a disgruntled employee who knows his time is up. His actions in the CFPB’s twilight hours are more about politics than protecting consumers, revealing an agency that is not only overstepping its bounds but also undermining its legitimacy.
On December 20, 2024, the CFPB launched a series of lawsuits targeting financial institutions like Zelle, JPMorgan Chase, Bank of America, and Wells Fargo, alleging failure to protect consumers from fraud. Three days later, it filed complaints against Walmart and Rocket Homes for violating consumer protection laws. These actions are intended to cement the Biden CFPB’s ideological agenda before a new administration can restore balance and accountability. However, such eleventh-hour rulemakings and lawsuits lack substance and betray the Bureau’s mission of serving consumers.
On January 16, 2025, tech trade groups NetChoice and TechNet filed a lawsuit against the CFPB to block a new rule granting the agency supervisory authority over large nonbank payment apps and digital wallets. They argue that the CFPB lacks congressional authorization for such regulation and that the rule could stifle innovation and increase costs.
The CFPB has also targeted major financial entities with substantial penalties. On January 16, 2025, it fined payments firm Block, the operator of Cash App, for inadequate fraud prevention measures, requiring up to $120 million in consumer redress and a $55 million payment to the CFPB’s victim relief fund. Block contends that these issues are historical and not reflective of current operations.
Additionally, the CFPB filed a lawsuit against Capital One, alleging that the bank misled customers by keeping them in lower-yield savings accounts, resulting in $2 billion in lost interest. Capital One denies these allegations and plans to defend itself in court. The judiciary has also intervened in the CFPB’s recent actions. A Texas federal judge refused to lift a preliminary injunction blocking the CFPB’s enforcement of its final rule on credit card late fees, indicating that challengers to the rule are likely to succeed on the merits.
Chopra’s approach can only be described as a wrecking ball strategy. The lawsuits are riddled with factual and legal inconsistencies, as highlighted by industry pushback. Zelle called the allegations “legally and factually flawed,” while Rocket Homes and others have pointed out the lack of due process in the CFPB’s accusations. Rather than engaging in constructive dialogue with stakeholders, Chopra has opted for punitive measures designed to grab headlines and solidify his political legacy. But this gambit comes at a cost: it erodes trust in an agency already viewed with skepticism due to its unaccountable funding structure.
Unlike most federal agencies, the CFPB is funded by the Federal Reserve, bypassing the congressional appropriations process and avoiding direct oversight from elected representatives. This arrangement is constitutionally questionable and anti-democratic. The Supreme Court’s 2024 decision upholding the CFPB’s funding structure has not quelled these concerns. It has only strengthened calls for reform—or outright elimination—of an agency with minimal accountability.
This lack of oversight has allowed Chopra to wield the CFPB as a political weapon rather than a consumer advocate. The Bureau’s recent actions are less about protecting consumers and more about advancing a partisan agenda. By filing lawsuits against major financial institutions, Walmart, and others, the CFPB is attempting to impose new legal standards that exceed its statutory authority, effectively rewriting the law without congressional input.
As Republicans prepare to take control of the White House and both chambers of Congress, the CFPB’s days of unchecked power are numbered. President-elect Trump’s administration has signaled a return to regulatory sanity, prioritizing economic growth and consumer choice over bureaucratic overreach. GOP lawmakers, including House Financial Services Committee Chairman Patrick McHenry, have warned against last-minute rulemaking, urging agencies like the CFPB to refrain from finalizing partisan actions in their waning days. These warnings, however, seem to have fallen on deaf ears at the Bureau.
Chopra’s actions are those of a leader who knows his tenure is ending and wants to leave a lasting mark, no matter the collateral damage. Unfortunately, this scorched-earth approach harms the people the CFPB claims to protect. Chopra risks destabilizing markets and limiting access to financial services for consumers and small businesses by creating regulatory uncertainty and attacking key financial institutions.
The incoming administration must act decisively to rein in the CFPB and restore accountability. This means rolling back partisan rulemaking, dismissing frivolous lawsuits, and reexamining the agency’s funding structure to ensure proper oversight. Eliminating the CFPB should also remain on the table, as its unaccountable structure and repeated overreach have proven it to be more of a hindrance than a help to American consumers.
The CFPB’s eleventh-hour actions under Rohit Chopra are a desperate final gasp of an agency that has long operated outside its mandate. As the Southwest Public Policy Institute has consistently argued, consumers deserve protection and accountability from the agencies tasked with that role. The CFPB, in its current form, fails on both counts. It is time for a new chapter that prioritizes transparency, accountability, and true consumer advocacy over partisan politics.