President Trump Removes CFPB Director Rohit Chopra

President Donald Trump has terminated the Director of the Consumer Financial Protection Bureau, Rohit Chopra, and has designated Secretary of the Treasury, Scott Bessent, as Acting Director of the CFPB.

Chopra was appointed as director during the Biden administration in 2021, committing himself to making the financial system more reasonable for consumers and opposing any regulations or practices that undermined this goal.

The CFPB was created in the aftermath of the 2008 global financial crisis, which was caused in part by banks’ irresponsible lending and securitization practices. The agency’s mandate is to protect consumers from financial frauds and scams, to fight unfair banking and financial practices, and to offer a recourse for consumers who have been scammed or defrauded.

Although Chopra was initially given a five-year term for his position, the Supreme Court ruled in the case of Seila Law v. CFPB that such a director should be treated as an at-will employee for the purposes of presidential removal. As a result, it was within the President’s constitutional authority to fire Chopra and designate a new director for the Bureau.

During his tenure as CFPB Director, Chopra removed medical debt from credit reports, limited overdraft penalties, and limited credit card late fees. The former director also led an initiative which would ultimately provide consumers with more easy access to and privacy of their financial data.

Under the leadership of Chopra, the CFPB also brought numerous actions against some of the nation’s biggest banks such as Wells Fargo, JPMorgan, and Bank of America, for failing to protect consumers from widespread fraud. The case remains ongoing but seeks to impose a heavy penalty on the banks and implement measures to prevent similar violations in the future.

Although Chopra’s termination fell within President Trump’s executive authority, his administration has faced some criticism over the move. Many critics have pointed to Chopra’s success as support for the argument that President Trump was in the wrong.

President Trump’s Move Faces Praise and Criticism

“One of the most effective consumer champions in government in American history, Rohit Chopra worked tirelessly to protect vulnerable citizens from financial predators. The CFPB under Chopra eliminated many junk fees, capped credit card late charges, reformed reporting of medical debt, sued giant corporations, and elevated the total relief to consumers beyond $21 billion,” according to Co-President of Public Citizen, Lisa Gilbert. “An administration that retreats from the many advances the agency made while under his leadership will betray working Americans. That Trump’s oligarchs want this agency ‘deleted’ attests powerfully to Chopra’s effectiveness and the need for the CFPB – and Trump’s firing of Chopra is as clear a sign as there could be of whose side Trump is on.”

However, many groups praised the President’s move as they saw it as a step in the right direction for the Bureau. “The longer Director Chopra stays, the harder it will be for this pro-growth administration to undo the politically-driven, government-price setting agenda that former President Biden’s appointee has engaged in over the last several years at the Bureau,” according to Consumer Bankers Association press secretary, Weston Loyd.

The CFPB has faced a large number of challenges in the previous years. Many brought challenges seeking to undermine the agency. The challenges were brought on a constitutional basis in which it was argued that the agency is funded illegally.

While most agencies are funded by an annual budget process in Congress, the CFPB is funded directly by the Federal reserve. Although it may be argued that such funding violated the Appropriations Clause of the Constitution—a law of Congress that provides an agency with budget authority—the Supreme Court rejected ultimately such the argument and held that it was not in fact a violation.