The U.S. Supreme Court said it will take up a case challenging the Consumer Financial Protection Bureau's funding method after a federal appeals court ruled last fall that it is unconstitutional.
Details: The 5th U.S. Circuit Court of Appeals ruled in October that the CFPB’s funding structure—in which the agency receives funds through the Federal Reserve, rather than congressional appropriations—violates the U.S. Constitution’s separation of powers.
Timeline: The Supreme Court said it will take up the case during its next term, which starts in October, after denying a government petition to expedite the case. A decision is unlikely before next year.
Governance Question: The case could also renew the debate over whether the CFPB’s single-director governance should be replaced with commission-based leadership, as ICBA has long advocated to limit political interference and promote balanced supervision. The high court previously ruled that the CFPB's governance structure is unconstitutional and that the president must have the authority to remove the bureau head.
