CFPB Provisions Updated in One Big Beautiful Bill 

Senate Banking Committee Chair Tim Scott has released updated legislative text of provisions in Senate Republicans’ One Big Beautiful Bill. And after a marathon weekend of adjusting legislation to fit parliamentarian rulings lawmakers are stalling their vote on a series of “motions to commit,” which would refer the bill back to committee for more consideration, while they await a ruling from the parliamentarian on a key portion of the bill. 

Last week, Senate Parliamentarian Elizabeth MacDonough ruled that several key pieces of the bill violated the Byrd Rule, a measure that prohibits provisions considered “extraneous” to the federal budget. Among the changes by Senate Parliamentarian MacDonough, striking a provision that would have placed a funding cap on the Consumer Financial Protection Bureau (CFPB), a move that would have cut approximately $6.4 billion from the Bureau, thus reducing the Bureau’s funding to zero percent, and eliminating the agency. 

CFPB revisions to One Big Beautiful Bill as unveiled by Sen. Scott—would cut the agency’s budget nearly in half. Sen. Scott’s new provision would see CFPB’s available operating budget go from 12% to 6.5% of the Federal Reserve System’s 2009 total operating expenses, adjusted for inflation. The updated provisions would decrease the CFPB’s funding cap for a savings of $2 billion, and rescind unobligated funds from the Inflation Reduction Act for green housing initiatives to the Treasury for a savings of $138 million. Another provision would take unused money from the Securities and Exchange Commission (SEC) for technology modernization and eliminate the fund permanently for a savings of $448 million. The net budgetary impacts from those cuts would result in a 10-year budgetary savings of $1.595 billion, according to a summary of the provisions. 

“After working closely with my colleagues on the committee and across the Republican conference, as well as the Senate Parliamentarian, we’re in a position to advance legislation that helps deliver on President Trump’s mandate to cut waste and duplication in our federal government and save hardworking taxpayer dollars,” said Sen. Scott. “The Committee’s language decreases the Consumer Financial Protection Bureau’s (CFPB) funding cap without affecting the statutory functions of the Bureau. In addition, the updated legislation rescinds unused funds earmarked for green housing initiatives and saves taxpayer dollars by eliminating an unnecessary reserve fund at the SEC. These provisions will reduce waste and duplication in financial regulation, put our federal government on a more sustainable fiscal path, allow Americans to keep more of their hard-earned money, and bolster our national security.” 

Sen. Elizabeth Warren, ranking member of the Senate Banking Committee and an architect of the CFPB, said that Senate Democrats would introduce an amendment to strip Sen. Scott’s proposal from the reconciliation package, highlighting that the CFPB has given billions back to American families impacted by financial crimes since the launch of the Bureau. 

“Donald Trump and Republicans tried to shut down the CFPB by gutting its entire operating budget to 0%,” said Sen. Warren. “We fought back and won. Now, Senate Republicans will bring to the floor a proposal that slashes the agency’s available budget so they can hand out more tax breaks for billionaires and billionaire corporations. The CFPB has returned $21 billion to scammed American families—and Democrats will introduce an amendment on the floor to strip this out of the bill.” 

In a letter to U.S. Senate Majority Leader John Thune, Consumer Reports is urging its members to oppose the budget reconciliation bill provision that would slash the CFPB’s budget.  

“Slashing the CFPB’s funding in half would severely hinder its ability to root out discrimination and predatory financial practices that put consumers at risk of fraud and abuse,” said Chuck Bell, Consumer Reports Advocacy Program Director in the letter. “At a time of rising costs and so much economic uncertainty, the last thing Congress should do is weaken the watchdog created to protect consumers from losing money to financial scams and ripoffs.” 

Bell continued, “Congress should stand with consumers and reject this devastating cut to the CFPB’s budget. We need a strong and independent CFPB with the resources necessary to defend consumers and rein in abusive financial practices without political interference from powerful special interests.” 

In addition to Consumer Reports, a group of 193 civil rights, community, consumer, labor, faith-based, small business, farm, and other organizations have sent a letter urging the Senate to stand up for the CFPB, and oppose devastating attacks on its budget. 

“The CFPB’s robust record of getting things done is precisely what makes the agency objectionable to banks, Big Tech, credit card companies, fringe financial firms, fintech companies, and credit bureaus that want to be able to get away with treating people unfairly and breaking the law,” said the groups in the letter

Patrick Woodall, Managing Director for Policy at the Americans for Financial Reform, added, “Congress must work to keep the CFPB fully funded and independent, so that it can continue to protect people from ripoffs, junk fees, fraud, and unfair treatment.” 

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Picture of Eric C. Peck

Eric C. Peck

MortgagePoint Managing Digital Editor Eric C. Peck has 25-plus years’ experience covering the mortgage industry. He graduated from the New York Institute of Technology, where he received his B.A. in Communication Arts/Media. After graduating, he began his professional career in New York City with Videography Magazine before landing in the mortgage finance space. Peck has edited three published books, and has served as Copy Editor for Entrepreneur.com.
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