Judge Forces White House Budget Director to Keep Consumer Bureau on Life Support

Begrudgingly, Russell T. Vought just requested $145 million from the Federal Reserve to keep the Consumer Financial Protection Bureau — which he runs — alive. Barely.

Only a few months of the CFPB’s work will be covered by that $145 million.

Judge Amy Berman Jackson declared in a December 30, 2025 federal court order that Vought, CFPB acting director, has to keep requesting funds, as reported by The New York Times.

“I disagree,” said Vought when writing the funding request.

Trying to Shut It Down

Next month, the U.S. Court of Appeals for the D.C. Circuit will hear an appeal of the same judge’s decision that Russell Vought cannot fire the CFPB staff completely out of existence.

Vought also directs the White House budget office. Under a Congressional deadline, Vought will need to vacate his acting director role at the CFPB by August 1.

Meanwhile, Vought appears to be working tirelessly to sabotage the agency he’s been entrusted to lead. This is after a Trump-signed bill came into effect that cuts the allowable CFPB funding almost by half.  

Normally, a CFPB director sends in funding requests multiple times a year. But Vought hasn’t tried to request any funding at all over the past year. He’s openly expressed a desire to shutter the CFPB. So far, the National Treasury Employees Union and others have fought Vought’s plans.

Vought has claimed that the Federal Reserve may no longer fund the consumer bureau — despite the fact that it’s done so for years. The Justice Department pressed Federal Reserve leader Jerome Powell to confirm whether the Fed may be returning to profitability. If not, the CFPB cannot get funding from the Fed, Vought has insisted.

Why Is Vought There?

Last year, the Consumer Financial Protection Bureau lost its principal deputy enforcement director, Michael G. Salemi. Seeing “no path” to future effectiveness under the Trump administration, Salemi resigned on December 4, 2025.

The administration halted so much work at the agency that Salemi saw no point in carrying out an essentially meaningless role.

Salemi’s resignation was one of a string of departures from CFPB leadership. Former enforcement chief Eric Halperin was among the exodus that Salemi joined. Acting director Cara Petersen had already left, pointing to the way the agency’s enforcement leadership was being stripped of its authority.

When Salemi left, no potential successor remained. Standing in the void, Vought took charge of the CFPB in February 2025. Vought has presided over staff cuts, and left parties to legal settlements in the lurch. ​

What Now?

The U.S. Court of Appeals for the D.C. Circuit will rehear the National Treasury Employees Union’s case against Vought, beginning on February 24.

Meanwhile, CFPB watchers believe enforcement work will continue to slow down. Specifically:

• The administration’s funding cuts indicate that very few new legal actions will be opened. Most active court cases are being passed to the Department of Justice.

• Corporations involved in litigation with the CFPB will get different government lawyers. They’ll be looking at new negotiations and new timelines.​

• The everyday work of enforcing consumer protections has largely been placed on hold. Current investigations have remained open at the CFPB, but personnel is scant. In December, more than 100 enforcement employees received reduction-in-force notices.  

In short, cases are being shuffled off, settlements cancelled or upended, and investigations suspended. It’s unlikely, then, that the CFPB can be an effective force in 2026. The loss of staff members and their institutional knowledge has left a vacuum that sets consumer rights back to a chaotic time in U.S. mortgage history.

What Exactly Will We Lose, in the Absence of the CFPB?

If we lose the CFPB, we lose an entity that offers free, plain-language guidance for people shopping for mortgages. The CFPB has also issued guidance for the use of algorithms, including AI. The CFPB explained how federal law demands transparency in loan application decisions — even when lenders use complex technology. Will we lose that guidance now? This is a major concern, given the hard-to-trace applications of algorithms to issue decisions that can make obtaining a deed possible or not.

We’ll also be losing a constant defender of ordinary deed holders. Congress established the CFPB to champion the rights of borrowers after the 2008 financial crisis pushed many home buyers into foreclosure. Since its formation, the CFPB’s core mission has been working to prevent U.S. borrowers from being taken advantage of.

The Consumer Financial Protection Bureau acts as a check on Wall Street financial giants. To date, it has forced these corporations to give nearly $20 billion back to customers through refunds and debt relief. That tells us a lot about what ordinary working people will lose if we lose the CFPB.

When the Cat’s Away Look Out for Those Mice

The Federal Reserve and the CFPB have long worked in symbiosis, under the Consumer Financial Protection Act. The law directs the Fed to fund the CFPB — with an “amount determined by the Director to be reasonably necessary” — quarterly. And the U.S. public never had to worry about that getting done in a reasonable way.

Financial companies now know “the cat’s away” at the CFPB. Consumer advocates say we’ve entered a time of lessened accountability for corporations. It’s hard to read that as anything but more risk for the ordinary individual investor or borrower.

With federal oversight weakening, home buyers need to look out for their interests. Here are practical steps mortgage borrowers and others can take to protect themselves.

Mortgage Fraud Makes Us All Poorer

Mortgage fraud, as it happens, is rising. Fraud typically does rise as more investors take out multiple mortgages with multiple lenders. And this year’s statistics show about a third of home sales going to investor-buyers rather than that ordinary individual investor or borrower.

When oversight is weakened, we all wind up paying. Manipulative or unfair lending practices cost us all.

The formation of the CFPB has directly impacted home buyers. It has helped keep mortgage costs in check. It has worked to level the playing field for lenders and borrowers. Without the CFPB having our backs, consumers have weaker recourse for lending mistakes, deceptions, or “black box” decisions that can change our lives.

For now, we look forward to the rehearing on February 24 by the full D.C. Court of Appeals. We’ll keep our eyes on the legal actions. And we’ll keep our readers updated on the status of our embattled consumer watchdog.