By Tierney Sneed

(CNN) — A federal judge said Tuesday that the Trump administration must keep funds flowing to the US Consumer Financial Protection Bureau, rebuffing its latest gambit to shut down the regulatory agency that has long been a target of conservatives.

US District Judge Amy Berman Jackson, who previously halted President Donald Trump’s attempts to dismantle the bureau, said that the administration couldn’t adopt a novel legal theory to cut off its funding in an alternate effort to kill it.

“Neither the statute, the injunction, nor the Fed’s willingness to pay has changed,” Jackson wrote, referring to the Federal Reserve, which funds the CFPB. “(T)he only new circumstance is the administration’s determination to eliminate an agency created by Congress with the stroke of pen, even while the matter is before the Court of Appeals.”

Jackson’s opinion leaned on comments CFPB Director Russell Vought, a Trump appointee, made in October predicting that the administration’s efforts to “close down” the agency would be “successful probably within the next two, three months.”

“This candid statement does not mark a change in the Acting Director’s approach; he said as much on his first day on the job, and it would be foolhardy not to take Russell Vought at his word this time,” she wrote.

The dispute over CFPB’s funding is the latest blow-up in the administration’s crusade to dissemble an agency that Trump promised to abolish on the campaign trail. It was created by Congress in the wake of the 2008 financial crisis, and it conducts oversight over the financial services industries and responds to consumer complaints, among other duties.

In a lawsuit brought by consumer advocate groups and a union representing CFPB employees in early 2025, Jackson previously blocked Trump from taking major steps to hollow out the agency, including with mass firings. The administration eventually secured a ruling by a panel of the DC US Court of Appeals reversing that order, but that appellate ruling did not take effect, and the full DC Circuit voted on December 17 to rehear the case. In the meantime, the agency’s political leadership has not been able to carry out the mass layoffs that it envisioned in the early days of Trump’s second term.

Jackson’s latest ruling addresses efforts to end the CFPB’s funding while the jockeying at the appeals court played out. The Trump administration indicated to Jackson this fall that the agency would run out of funding in 2026 due to a new reading of where the funding could come from at the Fed.

The administration pointed to a newly released opinion by the Justice Department’s Office of Legal Counsel that adopted an interpretation of the relevant statute that significantly narrowed the pool of Federal Reserve funds available to support the CFPB.

That OLC memo, Jackson wrote Tuesday, was “a sharp departure from the Bureau’s longstanding interpretation of its statutory funding procedure” and one that she determined “cannot be squared with the plain meaning of” the law’s text, nor “the legislative intent behind the establishment of the Bureau.”

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