Elizabeth Warren: Only Congress Can Dissolve CFPB, Legal Clash with Trump Likely
Democratic Senator Elizabeth Warren has asserted that Congress holds the sole authority to dismantle the Consumer Financial Protection Bureau (CFPB), potentially setting the stage for a legal confrontation with the Trump administration.
In an interview with Yahoo Finance, Warren emphasized that the CFPB was established by Congress and cannot be eliminated by President Trump, Tesla CEO Elon Musk, or any other individual. She added that if the administration disregards this legal requirement, lawmakers will resort to the courts to enforce it.
Warren joined a group of 200 lawmakers in sending a letter to acting CFPB director Russ Vought and Treasury Secretary Scott Bessent, demanding the removal of Musk's operatives from the agency and the restoration of its operations. Jonathan McKernan has been nominated as the CFPB's permanent director.
"The law is clear on this, and the courts will enforce the law if Elon Musk and Donald Trump break it," Warren stated.
She dismissed the suggestion of integrating the CFPB into the Congressional appropriations process to ensure its stability. Warren argued that opponents of the agency seek its complete elimination, not incremental adjustments.
The Trump administration has ordered the suspension of all CFPB operations and prohibited employees from entering its Washington, D.C., headquarters. Musk has hinted at these actions, tweeting "CFPB RIP" shortly after DOGE personnel arrived at the agency.
Republicans have frequently criticized the CFPB since its inception, contending that it dupes regulatory functions. The Trump administration is reportedly considering plans to consolidate banking regulators without congressional input.
Warren criticized the proposal to merge the Federal Deposit Insurance Corporation (FDIC) with another agency, emphasizing its crucial role as a deposit insurer. She raised concerns about the potential consequences of eliminating the CFPB's oversight of the largest banks.
Warren advocates for lower interest rates and urges the Fed to reduce them at its upcoming policy meeting in March. President Trump has also called for lower interest rates, though it remains unclear whether he refers to the Fed's short-term or long-term rates.