Senate Republicans Move to Slash CFPB Budget Amidst Controversy
In a significant shift, Senate Republicans have proposed cutting the funding for the Consumer Financial Protection Bureau (CFPB) by nearly half as part of President Trump’s “Big Beautiful Bill.” This drastic reduction could lead to hundreds of job losses within the CFPB, which was established in the wake of the 2008 financial crisis to regulate the financial services industry. Currently funded through a share of the Federal Reserve’s profits, the plan would reduce the CFPB’s funding cap from 12% to 6.5%, forcing the agency to significantly scale back its budget or seek congressional funding—something Republicans have sought for years.
Under the leadership of former director Rohit Chopra, the CFPB aggressively investigated various financial entities and returned billions to consumers. However, since the Trump administration, the agency has experienced diminished effectiveness under acting director Russell Vought, with major regulatory functions notably stalled.
The recent proposal follows an earlier attempt to eliminate the CFPB’s budget entirely, which faced procedural challenges. Democrats are expected to oppose this budget cut in the Senate, emphasizing the impact on consumer protection as Republicans prioritize tax cuts for corporations.
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