By Annie Pulley

The Badger Project

The Badger Project is a nonpartisan, 

citizen-supported journalism nonprofit in Wisconsin.

“CFPB RIP,” wrote Elon Musk in a Feb. 7 post on his social media platform X. 

His short message paralleled his Department of Government Efficiency’s entry into the headquarters of the U.S. Consumer Financial Protection Bureau, the independent federal regulator created in response to the 2008 financial crisis.

The CFPB enforces federal consumer financial laws, responds directly to consumer complaints and targets deceptive and unfair business practices. 

Though state attorneys general and other state regulators are empowered to enforce the CFPB’s Consumer Financial Protection Act, they cannot work across state lines. Wisconsin Attorney General Josh Kaul warned in a Feb. 20 press release that “dismantling” the bureau may “significantly harm consumers” and “significantly reduce oversight of very large banks.”

“I do fear that consumers are going to be hurt by this,” said Rebecca Neumann, an economics professor at the University of Wisconsin—Milwaukee.

Since launching in 2011, the CFPB says it has facilitated $21 billion in monetary compensation and other forms of consumer relief to consumers nationwide. 

Consumers in Wisconsin have reported more than 57,000 complaints to the bureau in that time, according to its Consumer Complaint Database. The vast majority of these complaints centered on personal credit reports and credit repair services.

The CFPB is one of many federal agencies in the crosshairs of both President Donald Trump and DOGE, the extra-governmental body led by Musk.

In November 2024, the CFPB published a rule expanding its ability to regulate popular payment apps, like Venmo and Paypal. Musk’s latest venture to enable X users to transfer money through the app would be affected by that rule change.

Chaos has reigned in the early weeks of the second Trump Administration, making it hard to understand what is happening in the federal government, but reports suggest that CFPB’s more than 1,700 employees were ordered to stop working. New leadership also fired dozens of probationary employees.

Russell Vought, the Trump-appointed acting director of the CFPB and the architect of the right-wing plan to remake and shrink the federal government called Project 2025, announced on his X account Feb. 8 that the bureau would no longer request “unappropriated funding.”

To protect its revenue stream, Democrats who created the independent agency wrote legislation that it be funded by the Federal Reserve rather than appropriations of cash from Congress. However, the president can appoint the bureau’s director, and the Senate is responsible for confirming the pick. Congress can also request audits of the CFPB and can question the CFPB director during semiannual hearings. 

A federal judge in Washington D.C., frustrated with a lack of clarity from the Trump Administration and the federal union that brought a lawsuit against it for its actions at the CFPB, has ordered the bureau’s leadership to testify before the court before she makes any decisions. The administration’s lawyers argue it is trying to streamline the bureau, despite Musk’s declaration of its death. The union says the administration is trying to choke the bureau out of existence.

Between April 2023 and March 2024, the CFPB received about 1.8 million consumer complaints directed toward businesses and financial institutions, according to its most recent in-depth report. Most were related to credit or consumer reporting. 

Consumers often receive non-monetary relief from the CFPB, meaning the company may have corrected inaccurate data on a credit report or stopped calls from debt collectors rather than awarded a financial sum.

The vast majority of 2023 complaints, Neumann said, targeted the three main credit reporting agencies: Equifax, Experian and TransUnion.

“What that says to me is that this is a necessary bureau,” she continued.

The CFPB is a uniquely consumer-oriented agency that was needed in 2008 and is arguably more essential in 2025, Neumann said.

With innovations in artificial intelligence, digital payment methods and cryptocurrencies, the financial landscape is rapidly evolving, she said.

The CFPB also issues reports on new financial products and how they may pose risks to consumers. It’s a resource of financial literacy education for both adults and children. 

In Wisconsin, about 51% of residents can’t accurately answer basic financial literacy questions, according to data from the FINRA Foundation.

During the Biden Administration, the CFPB issued regulations to place caps on overdraft and credit card late fees and moved to ban the inclusion of medical bills from credit reports.

Medical bills, Neumann explained, often lead people to declare bankruptcy, even if the root problem is a failure of one’s insurance company to pay the charge.

Across Wisconsin, about 24% of residents have overdue medical bills, according to data from the state’s Wisconsin Department of Financial Institutions. Seventeen percent of state residents occasionally overdraw funds from their checking accounts, and about 34% carried over a credit card balance and paid interest. 

The landscape of financial regulation will look different if the CFPB’s future remains in doubt, and the president has not offered viable alternatives, Neumann said.

“How are you letting consumers know where else they can go?” she asked. “I would like to see a lot more of that nuanced argument about how much regulation is enough and what type of regulation. Right now, it seems like there’s just a push to get rid of a lot of regulation, and I think we’re going to err too far on eliminating too much of it, and that’s going to open us up to another financial crisis.”

In Wisconsin, the state Department of Financial Institutions, the Office of the Commissioner of Insurance and the state Department of Agriculture, Trade and Consumer Protection all help protect consumers, but the CFPB, Neumann said, was specifically created to address gaps in consumer protection exposed by the 2008 financial crisis. 

The CFPB is an outgrowth of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010; it was Congress’ response to the Great Recession and the failure of the banking sector, particularly mortgage lending. The agency was created to regulate the mortgage industry and other financial products.