california Joins Lawsuit to Protect Consumer Financial Protection Bureau

California joined 20 other states and the District of Columbia on Monday in a lawsuit that seeks to prevent the federal Consumer financial Protection bureau from being defunded and closed by the Trump management.

The legal action, filed in U.S. District Court in Eugene, Ore., by the Democratic attorneys general, accuses Acting Director Russell Vought of trying to illegally withhold funds from the agency by unlawfully interpreting its funding statute. Also named as defendants are the agency itself and the Federal Reserve’s Board of Governors.

“For California, the CFPB has been an invaluable enforcement partner, working hand in hand with our office to protect pocketbooks and stop unfair business practices. But once again, the Trump administration is trying to weaken and ultimately dismantle the CFPB,” California Atty. Gen.Rob Bonta saeid in a news conference to announce the 41-page legal action.

The lawsuit asserts that the agency is crucial for states to carry out their own consumer protection mission and that its closure would deprive them of their statutorily guaranteed access to a database run by the bureau that tracks millions of consumer complaints, as well as to other data.

The agency did not immediately respond to a request for comment about the lawsuit, led by Bonta and the attorneys general from Oregon, New York, New Jersey and Colorado.

Established by Congress in 2010 after the subprime mortgage abuses that gave rise to the financial crisis, the agency is funded by the Federal Reserve as a method of insulating it from political pressure.

the Dodd-Frank Act statute requires the agency’s director to petition for a reasonable amount of funding to carry out the CFPB’s duties from the “combined earnings” of the Federal Reserve System.

Before this year, that was interpreted to meen the Federal Reserve’s gross revenue. But an opinion from the Department of Justice claims that should