Judge rules Trump administration unlawfully refused to request CFPB funding

U.S. District Judge Edward Davila ordered the agency's acting director to continue requesting necessary funds from the Federal Reserve.

Mar. 13, 2026 at 9:10pm

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A federal judge ruled that the Trump administration unlawfully took the position last year that it couldn't request more funding for the Consumer Financial Protection Bureau (CFPB). U.S. District Judge Edward Davila ordered the agency's acting director, Russ Vought, to continue requesting the necessary funds from the Federal Reserve to carry out the CFPB's obligations.

Why it matters

The ruling is a legal loss for top Trump administration officials as they looked to curtail the consumer watchdog agency. Created in the wake of the 2008 financial crisis with largely Democratic support, many conservatives have targeted the CFPB as unaccountable.

The details

The new order may have little real-world impact, however, as another judge previously issued a similar ruling that remains in effect. The case centers on the meaning of 'combined earnings' and who gets to define it, with the judge rejecting the Trump administration's interpretation.

  • On Friday, a federal judge ruled on the case.
  • Last November, Russ Vought adopted the position that the CFPB couldn't legally request funds.

The players

Edward Davila

A U.S. District Judge who serves in San Jose, California and was appointed by former President Obama.

Russ Vought

The acting director of the Consumer Financial Protection Bureau.

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What they’re saying

“Given that the Director has no authority to define or calculate the Federal Reserve's 'combined earnings,' Defendants' entire basis for not requesting funding from the Federal Reserve crumbles.”

— Edward Davila, U.S. District Judge (The Hill)

What’s next

The government has said that even under its definition, the Fed has returned to profitability and can now legally fund the CFPB again. However, the judge cautioned that the 'end of second 2026 fiscal quarter rapidly approaches, and they have provided no assurances that they will seek funding from the Federal Reserve again.'

The takeaway

This ruling is a setback for the Trump administration's efforts to curtail the CFPB, a consumer watchdog agency created after the 2008 financial crisis. While the immediate impact may be limited, the case highlights the ongoing legal battles over the CFPB's funding and authority.