The agency filed the notice in NTEU v. Vought. According to the CFPB, the OLC opinion concludes the Bureau may not draw funds from the Federal Reserve under its current statutory funding mechanism because the Fed has no combined earnings from which to draw.
OLC opinions are binding upon Executive Branch agencies, including the Bureau, the CFPB said in its filing.
Under the Dodd-Frank Wall Street Reform Act, the CFPB is authorized to request up to a specified percentage of the Federal Reserve's total operating expenses. The funding structure was designed to insulate the consumer protection agency from the traditional congressional appropriations process.
The CFPB stated it anticipates having sufficient funds to continue operations until at least December 31, 2025. The agency did not specify what alternative funding sources it might pursue or whether it would challenge the OLC determination.
The Supreme Court previously upheld the CFPB's funding structure against constitutional challenges in CFPB v. Community Financial Services Association of America.
According to the CFPB, the Federal Reserve has faced operating losses tied to its monetary policy operations and interest paid on reserves held by commercial banks. Those losses have affected the Fed's remittances to the Treasury and the combined earnings available for CFPB funding.