Attorney General Jeff Jackson Sues to Defend Consumer Protection Funds

FOR IMMEDIATE RELEASE
Tuesday, December 23, 2025
Contact: nahmed@ncdoj.gov
919-538-2809

RALEIGH – Attorney General Jeff Jackson is suing to protect Congressionally-mandated funding for federal consumer protection efforts after the acting director of the Consumer Financial Protection Bureau (CFPB) threatened to unlawfully and unconstitutionally refuse to fund the agency’s operations. The CFPB has returned more than $21 billion to more than 205 million Americans in the 14 years it’s been in operation, but without any additional funds it will run out of money in January. North Carolina and other states work closely with the CFPB to defend consumers’ rights and win back money for people who have been unfairly treated by businesses and lenders.  

“Congress created the CFPB, funded it, and gave it a clear mission: protect consumers,” said Attorney General Jeff Jackson. “No agency official has the authority to override that decision. This lawsuit is about making sure consumers don’t lose a watchdog that has already returned billions of dollars to millions of people who were unfairly treated.” 

The CFPB writes and enforces rules to regulate financial institutions, collects critical economic data, and fields millions of consumer complaints every year. It is the only federal agency authorized to supervise the nation’s largest banks to make sure they are complying with consumer protection laws and to prevent them from taking advantage of Americans.  

The CFPB is required by law to provide vital information to the states that help them investigate wrongdoing, get money back for consumers, and support state lawsuits against financial institutions. States also regularly refer consumer complaints to CFPB for further assistance.  

In the past several years, the North Carolina Department of Justice has worked closely with the CFPB to fight for North Carolinians and win back money for consumers. Those cases include:  

• Reaching a $86.3 million settlement with Nationstar Mortgage, that gave back nearly $2 million to nearly 2,000 North Carolinians.  

• Suing and winning $95 million in student loan relief for people harmed by the Consumer Advocacy Center/Premier Student Loan Center, including more than $4 million in relief for 3,649 North Carolinians.  

• Reaching a more than $30 million settlement against student lender Prehired that shut down the company permanently and got North Carolinians more than $100,000 back.  

• Winning $683,000 in refunds for more than 4,300 Citi credit card holders in North Carolina after the CFPB found that the bank had violated the law and overcharged people for credit card interest.  

• Winning more than $330 million in debt relief for former ITT Technical Institute students after the school filed for bankruptcy. In North Carolina, 1,500 former students received more than $12 million in debt relief.  

In November, current CFPB acting director Russel Vought took a novel position that the agency can only be funded by the Federal Reserve’s “profits,” which he asserted are currently nonexistent. Vought therefore made the decision not to request any funding from the Federal Reserve. The attorneys general argue that Vought’s decision violates the law and the Constitution. The CFPB was established by Congress, and Vought does not have the authority to stop it from receiving funding.  

The attorneys general are asking the court to order the agency to request funding from the Federal Reserve to fulfill its duties as required by the law.    

Joining Attorney General Jackson in filing this lawsuit are the attorneys general of Arizona, California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New Mexico, New York, Oregon, Rhode Island, Vermont, Wisconsin, and the District of Columbia.  

 A copy of the complaint is available here. 

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