Republicans have introduced legislation that would give Congress more control over the financial consumer protection watchdog agency that has long faced opposition from Wall Street and conservatives, a move that comes after the Trump administration attempted to dismantle the agency.
Among other reforms, the bill would put the Consumer Financial Protection Bureau, which was the brainchild of Sen. Elizabeth Warren (D-MA), through the regular congressional appropriations process.
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Today, the agency is funded by the Federal Reserve, meaning that Congress cannot exercise the power of the purse over it. Republicans see the CFPB as having too much power and have sought to give Congress more control over the agency.
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The legislation’s sponsor, Rep. Andy Barr (R-KY), who chairs the Subcommittee on Financial Institutions, said that reform has long been needed at the CFPB, which was created in the wake of the 2008 financial crisis through the Dodd–Frank Act.
“For too long, the Consumer Financial Protection Bureau has operated with vague rules, limited accountability, and the ability to change the law through enforcement actions after the fact,” Barr told a packed room on Capitol Hill for a fireside chat with him and House Financial Services Committee Chairman French Hill (R-AR).
Earlier this year, President Donald Trump’s administration moved to gut the agency. Russell Vought, who is the director of the U.S. Office of Management and Budget, was made acting director shortly after Trump entered office and worked to unwind much of the agency. Mark Paoletta is now the acting director.
The CFPB oversees credit cards, mortgages, payday loans, and many other financial products used by households.
The new CFPB reform legislation, the Consumer Financial Protection Accountability and Reform Act of 2026, includes numerous reforms and has courted more than two dozen cosponsors, but notably, no Democratic cosponsors.
In addition to funding the bureau through the appropriations process, the bill would establish a CFPB inspector general, rather than the Fed’s inspector general. That inspector general would testify semiannually before the Financial Services Committee and the Senate Committee on Banking, Housing, and Urban Affairs.
“These measures do not weaken the bureau; they strengthen confidence being confirmed through direct, independent oversight,” Kathy Kraninger, former CFPB director and the current president and CEO of the Florida Bankers Association, said during the Tuesday panel discussion.
The legislation would also require that all CFPB rulemaking include a justification for the proposed rule, a cost-benefit analysis of the direct and indirect costs and benefits, and potential alternatives to the rule.
The bill would also raise the asset threshold for supervision of banks and other entities by the CFPB from $10 billion to $30 billion, which would then be indexed to nominal gross domestic product going forward. That increase reflects the GDP growth since Dodd-Frank was enacted.
Prudential regulators would have sole authority over financial institutions under that $30 billion threshold, although the CFPB would still be allowed to refer enforcement actions and could require limited reports.
“Supervision should be efficient and balance the burden placed on institutions relative to their size and complexity, and that’s why the bill raises the threshold for CFPB supervision of banks and credit unions,” Hill said.
Proponents of the reform argue that without congressional guidelines, the agency’s policies can swing wildly from administration to administration.
Barr said that the legislation would put “an extraordinarily powerful agency back under democratic accountability.”
“The Trump administration and the CFPB’s current leadership have taken important steps to correct this approach, but administrative actions can be reversed by a future director too easily,” Barr said. “Only Congress can make these reforms durable by writing them into law.”
Trump officials have tried to reduce the CFPB’s role administratively in both of Trump’s terms.
Hill, who worked in community banking before coming to Congress, said the Consumer Financial Protection Accountability and Reform Act is an important step that will ultimately benefit consumers.
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“This bill will bring greater accountability, clarity, and predictability to the Consumer Financial Protection Bureau, while ensuring consumers have access to a competitive and innovative financial marketplace,” Hill said.
“The CFPB was created to protect consumers, and that mission matters,” the chairman added.
