There’s a really good argument to be made for the incoming Trump administration to suspend enforcement of any recent rules and regulations put in place by the outgoing Biden administration. I will leave the meaning of “recent” open as an exercise for readers, but personally, I’d be okay with defining it as “within the last four years.”

Case in point: the brainchild of Senator Elizabeth Warren (D-MA), the Consumer Financial Protection Bureau (CFPB), an organization notorious for not only behavioral problems by its leadership but also rampant overstepping in its portfolio of responsibilities. The CFPD reports to no one, and seems to reckon itself above the pale; in their latest such overstep, they have unilaterally decided that payment apps (like Paypal, Google Pay, etc.) and digital wallets shall be regulated as banks. 

Predictably, they’re being sued. Again.

Two major tech trade groups are challenging the Consumer Financial Protection Bureau’s (CFPB) effort to treat payment apps and digital wallets like banks. In a lawsuit filed in federal court in Washington, DC, NetChoice and TechNet claim that the CFPB’s digital payment regulation, announced on November 21st, 2024, is arbitrary and capricious.

“The CFPB’s unlawful power grab undermines the rule of law, further bloats the administrative state and puts American consumers and innovation at risk,” Chris Marchese, NetChoice’s director of litigation, said in a statement. “The CFPB’s actions create unnecessary roadblocks for businesses striving to meet consumer needs and set the stage for increased prices and reduced options.”

The CFPB is truly its creator’s child; Sen. Warren never saw a punitive tax, regulation, or government overreach she wouldn’t embrace wholeheartedly, even if said tax, regulation, or overreach isn’t worth 1/1024th of the paper it’s printed on.

The rule, which went into effect in late December, lets the CFPB oversee digital payment processors’ compliance with federal privacy and fraud laws through “proactive examinations.” The bureau estimated that the apps included under the rule — including Apple Pay, Google Wallet, PayPal, Venmo, and CashApp — collectively process more than 13 billion transactions a year.

But NetChoice and TechNet claim that the CFPB didn’t sufficiently identify consumer risks or gaps in oversight that would justify the rule. “The bureau failed to show that consumer risks the rule was even meant to alleviate in its haste to dream up a problem in search of a solution,” the suit claims.

This rogue bureau needs to be reined in.