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Lori Sommerfield

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With over two decades of consumer financial services experience in federal government, in-house, and private practice settings, and a specialty in fair lending regulatory compliance, Lori counsels clients in supervisory issues, examinations, investigations, and enforcement actions.

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The Consumer Financial Protection Bureau (CFPB or Bureau) is undergoing significant changes as the Trump administration implements sweeping layoffs just days after revising the Bureau’s regulatory priorities. According to reports, approximately 1,400-1,500 employees have received reduction-in-force notices, leaving the CFPB with just over 200 personnel to carry out its regulatory activities. This drastic reduction raises critical questions about the agency’s ability to effectively focus on its newly outlined priorities for 2025.

This article was republished on insideARM on April 22, 2025.

Yesterday, the Consumer Financial Protection Bureau (CFPB or Bureau) released a memo to staff outlining its new supervision and enforcement priorities for 2025.

On April 9, the White House issued a memorandum directing federal executive departments and agencies to repeal regulations deemed unlawful pursuant to certain U.S. Supreme Court decisions. This directive aims to address regulatory barriers that the Trump administration believes hinder economic growth and innovation. The memorandum implements Executive Order 14219, issued on February 19, 2025, which ordered the heads of all federal agencies to identify unlawful and potentially unlawful regulations within 60 days and begin plans to repeal them. Now, the administration is directing agencies to prioritize that review under 10 watershed Supreme Court cases, and to repeal regulations that are considered unlawful under those cases without public notice and comment, if possible.

The Consumer Financial Protection Bureau (CFPB or Bureau) agreed to vacate its controversial credit card late fee rule in a joint motion for entry of consent judgment filed in Chamber of Commerce of the United States of America v. CFPB yesterday. This significant move comes after the U.S. District Court for the Northern District of Texas found that the rule likely violated the Credit Card Accountability and Disclosure Act (CARD Act). The consent judgment marks a pivotal resolution in the case, with the CFPB acknowledging that the rule failed to allow card issuers to impose penalty fees that are “reasonable and proportional” to violations, as required by the CARD Act.

On April 11, the U.S. Court of Appeals for the District of Columbia Circuit issued an order partially staying the district court’s preliminary injunction in the ongoing legal dispute between the National Treasury Employees Union (NTEU) and the Consumer Financial Protection Bureau (CFPB). This decision marks a significant development in the NTEU’s challenge against Acting Director Russell Vought’s actions, which the union claims are unconstitutional and violate the Dodd-Frank Act. The appellate court’s order addresses several key provisions of the district court’s injunction, setting the stage for an expedited appeal process.

On April 9, the House of Representatives passed two Congressional Review Act (CRA) joint resolutions aimed at nullifying certain Consumer Financial Protection Bureau (CFPB) rules finalized in the final days of the Biden-Harris Administration. These resolutions, S.J. Res. 18 and S.J. Res. 28, target rules related to limiting the overdraft fees that may be charged by large financial institutions, and extending supervisory authority over certain providers of digital payments services, respectively. The CRA resolutions are now before President Trump for signature.

As federal agencies pull back on consumer protection regulations under the Trump administration, California is stepping up to fill the void. This shift was forecasted in January, when the Consumer Financial Protection Bureau (CFPB) released a report titled “Strengthening State-Level Consumer Protections” (discussed here), which provided a roadmap for states looking to bolster their consumer protection laws after the anticipated rollback with the new administration.

On March 28, the Federal Reserve Board, the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC) (together, the federal banking agencies) announced their intent to rescind the 2023 Community Reinvestment Act (CRA) final rule and reinstate the previous CRA framework. This decision comes in light of pending litigation in the Fifth Circuit by various banking trade associations contesting the rules by alleging regulatory overreach. The agencies stated they will continue to work together to promote a consistent regulatory approach to implementation of the CRA.

On March 28, the Consumer Financial Protection Bureau (CFPB or Bureau) was ordered by the U.S. District Court for the District of Columbia to reinstate its employees and resume its operations. This decision comes after the CFPB allegedly attempted to shut down its activities, leading to the National Treasury Employees Union (NTEU) filing a lawsuit questioning the legality of the shutdown. The court held that the CFPB’s actions to halt its operations and terminate its employees were not consistent with its statutory obligations under Title X of Dodd-Frank. As a result, the court granted a preliminary injunction requiring the CFPB to reverse its shutdown efforts, reinstate its workforce, and continue performing its statutory duties. On March 29, the Bureau filed its notice of appeal of the preliminary injunction.

In a surprising turn of events, the Consumer Financial Protection Bureau (CFPB or Bureau) and Townstone Financial, Inc. (Townstone) have jointly moved to vacate the Stipulated Final Judgment and Order previously entered in the CFPB’s enforcement action against the mortgage lender alleging redlining practices. This motion, filed on March 26, 2025, comes after significant allegations by the CFPB regarding the Bureau’s own handling of the case, which began in 2020 under the first Trump administration and continued under the Biden administration.