House Republicans Unveil Sweeping CFPB Reform Bill

The Consumer Financial Protection Bureau was created under the 2010 Dodd-Frank Act to enforce federal consumer-finance laws and supervise banks and nonbank lenders. Republicans have long argued that the CFPB wields overly broad authority and is insufficiently accountable because its funding sits outside the congressional appropriations process. A permanent narrowing of its mandate would reshape consumer redress, compliance costs and how aggressively future administrations can police financial firms.

At a July 15, 2026, House Financial Services Committee hearing, Republican lawmakers asked acting CFPB Director Russell Vought how Congress could curb the agency through amendments to Dodd-Frank. Vought urged lawmakers to define “unfair, deceptive, or abusive acts or practices,” or UDAAP, more precisely. The draft CFPB Reform Act of 2026 would also raise the asset threshold for direct CFPB supervision of large financial institutions to $21 billion from $10 billion, while subjecting the bureau to congressional appropriations and tighter oversight.

The Consumer Financial Protection Bureau, or CFPB, is an independent financial regulator created by the Dodd-Frank Act of 2010 to investigate unfair practices in the banking, lending and payments markets. It has recovered more than $21 billion for consumers. Its budget was originally provided by the Federal Reserve to shield enforcement from annual congressional appropriations and partisan disputes, but a new law enacted on July 4, 2025, cut the funding cap to 6.5% from 12%.

On June 4, 2026, Elizabeth Warren, the top Democrat on the Senate Banking Committee, joined all 11 Democrats on the committee in introducing a bill requiring the Federal Reserve to provide automatic and mandatory funding. The amount could not be less than 12% of the Fed's total operating expenses and would be based on what is reasonably necessary for the CFPB to enforce federal consumer financial law. The proposal aims to restore full funding and prevent the executive branch from weakening the agency by refusing to request funds.