The Roundup: Court Orders Indefinite CFPB Funding, State AGs Fill Federal Enforcement Gap, FTC Targets Rental Junk Fees, D.C. Circuit Weighs CFPB’s Future, Open Banking Rule Stalls
Welcome to the PerformLine Regulatory Compliance Roundup, home of the latest news, articles, and reports from our industry, curated for you. Let’s get into it.
In this edition: Federal judge orders indefinite CFPB funding, state attorneys general surge into the federal enforcement vacuum, FTC launches rental housing fee rulemaking, D.C. Circuit hears pivotal CFPB workforce case en banc, open banking rule remains paused amid reconsideration
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Federal Judge Orders Continued CFPB Funding, Rebuking Administration
A federal judge has ordered the Trump administration to continue funding the Consumer Financial Protection Bureau indefinitely, marking the second federal court to reject the administration’s strategy of starving the agency of resources. U.S. District Judge Edward Davila of the Northern District of California ruled on March 16 that Acting CFPB Director Russell Vought solicited a legal opinion from the Justice Department as part of what the court called an effort to shut down the bureau by relying on a flawed interpretation of the Federal Reserve’s finances and the law.
The ruling follows a December 2025 decision from a D.C. District Court judge who reached a similar conclusion and ordered Vought to request funds from the Federal Reserve. In January, Vought reluctantly requested $145 million to cover the bureau’s operations through March 2026, noting he did so under protest. The new ruling goes further, mandating that funding continue on an ongoing basis rather than quarter by quarter. Insurance Journal / Reuters
Why It Matters: The CFPB’s funding saga has dominated the regulatory landscape for over a year, and this ruling provides the strongest legal footing yet for the bureau’s continued operation. However, the administration is expected to appeal, and the recently enacted One Big Beautiful Bill Act cut the CFPB’s statutory funding cap from 12% to 6.5% of Federal Reserve operating expenses—a move that could significantly reduce the agency’s budget going forward. For compliance teams, the takeaway is that the CFPB isn’t going away, but its enforcement capacity will likely remain constrained.
State Attorneys General Fill the Federal Enforcement Vacuum
As CFPB enforcement activity has slowed and federal regulatory priorities have shifted, state attorneys general have stepped aggressively into the gap. In early 2026 alone, AGs across more than a dozen states launched consumer protection enforcement actions targeting predatory lending, deceptive subscription practices, hidden fees, and solar panel financing scams. A 21-state coalition also sued a major ride-sharing company for misleading subscription savings claims and deceptive negative-option practices.
The trend is bipartisan. Offices in New York, California, Massachusetts, Colorado, and Texas are expanding their enforcement teams—many hiring attorneys with former federal regulatory experience—and coordinating multi-state investigations at a pace not seen in recent years. Massachusetts reported a record 24,000+ consumer complaints in 2025, and Colorado saw complaints increase over 200% since 2019, with the AG receiving nearly 27,000 filings last year alone. Morgan Lewis
Why It Matters: This is the most significant macro shift in the compliance landscape right now. Companies that previously monitored one federal framework now need to track enforcement activity across dozens of states. State AGs have independent authority to enforce both state UDAP statutes and federal consumer protection laws under the Dodd-Frank Act—meaning the absence of CFPB action doesn’t create an enforcement gap, it redistributes it. Compliance teams should ensure their monitoring programs cover the full geographic scope of their operations.
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Significant Stat:
100,00+
The FTC has received more than 100,000 consumer complaints over the past five years related to negative-option and subscription practices—including misleading disclosures, unauthorized billing, and difficult cancellation processes. The agency cited this figure in its March 2026 Advance Notice of Proposed Rulemaking on negative-option practices as it considers whether to update or expand its existing rules. Read more
FTC Launches Rulemaking on Rental Housing Junk Fees
The Federal Trade Commission has issued an Advance Notice of Proposed Rulemaking (ANPRM) to explore a new federal rule addressing unfair or deceptive fee practices in the rental housing market. Published in the Federal Register on March 13, the ANPRM solicits public comment on pricing transparency issues across the entire lease lifecycle—from application fees and security deposits to mandatory monthly charges that inflate rent beyond advertised prices. Comments are open until April 13, 2026.
The rulemaking follows a string of FTC enforcement actions against major landlords, including a $48 million settlement with Invitation Homes over hidden fees and a separate settlement with Greystar Real Estate Partners for similar practices. The FTC simultaneously issued warning letters to 97 auto dealership groups about deceptive pricing and launched a parallel ANPRM on negative-option subscription practices—signals that drip pricing enforcement is a central priority for the current FTC. Federal Trade Commission
Why It Matters: While this rulemaking targets housing, the FTC’s pricing transparency push has clear implications for financial services. Hidden fees in lending, BNPL, cash advance, and banking products face the same scrutiny under existing FTC Act authority. The agency is also signaling that technology providers and platforms—not just the companies setting prices—may bear compliance responsibility. Colorado, California, Minnesota, and New York City have all enacted or expanded their own junk fee laws, adding state-level exposure on top of federal risk.
D.C. Circuit Hears Pivotal En Banc Case on CFPB Workforce Cuts
The full U.S. Court of Appeals for the D.C. Circuit heard oral arguments on February 24 in the case that could determine whether the Trump administration can effectively dismantle the CFPB through mass layoffs. The National Treasury Employees Union (NTEU) is challenging Acting Director Russell Vought’s attempt to issue a reduction-in-force covering roughly 1,400 of the bureau’s approximately 1,700 employees—a move the union argues amounts to an unlawful shutdown of a congressionally created agency.
A three-judge panel previously sided 2-1 with the administration last August, but the full 11-judge court vacated that ruling and took the case en banc. During oral arguments, multiple judges pressed the government on whether there is any limiting principle to its position—if an agency head can halt enforcement, supervision, rulemaking, and operations indefinitely, what would qualify as reviewable action? A ruling is not expected quickly, and legal experts anticipate a potential Supreme Court showdown in the 2027–2028 term if the union prevails. Consumer Finance Monitor
Why It Matters: This case goes beyond CFPB staffing—it tests whether the executive branch can use workforce reduction as a tool to functionally close an agency that Congress created. The outcome will set a precedent that affects every independent federal agency. For compliance teams, the practical question is what the CFPB can actually do while this plays out. With diminished staff, constrained funding, and ongoing litigation on multiple fronts, the bureau’s enforcement and supervisory capacity will remain limited regardless of the ruling.
Open Banking Rule Remains Paused as CFPB Reconsideration Drags
The CFPB’s Personal Financial Data Rights Rule—its signature open banking regulation—remains effectively frozen. A federal judge has issued an injunction delaying all compliance deadlines while the bureau undertakes a comprehensive reconsideration of the original Biden-era rule. The largest institutions were originally set to comply by April 2026, but that deadline is now moot. The CFPB issued an Advance Notice of Proposed Rulemaking in August 2025 seeking comment on four key areas: who qualifies as a consumer “representative,” whether banks can charge fees for data access, data security standards, and consumer authorization and privacy protections.
The reconsideration has drawn sharp interest from both sides. Banks and industry groups have argued that the original rule unfairly required them to subsidize fintech competitors by prohibiting fees for data access. Fintech organizations counter that further delays leave consumers reliant on less secure data aggregation methods like screen scraping. With the CFPB’s own operational future in question, the timeline for a revised rule remains highly uncertain. Consumer Financial Protection Bureau
Why It Matters: Open banking affects virtually every financial institution and fintech company in the U.S. The indefinite pause creates a compliance limbo where companies must continue monitoring the rulemaking without a clear timeline for action. Institutions that invested in API infrastructure for the original compliance deadline face sunk costs, while the broader industry loses ground to international markets where open banking frameworks are already operational. This remains one of the most consequential pending regulations for PerformLine’s audience.
That’s it for this edition of the Regulatory Compliance Roundup. Have questions, tips, or feedback? Reach out to us at performline.com or connect with us on LinkedIn.
