Section 1071 litigation
Rise Economy v. Consumer Financial Protection Bureau
Date: July 23, 2025
Issue: Whether CFPB violated the Administrative Procedure Act (APA) by failing to enforce its Section 1071 final rule.
Case Summary: A coalition of consumer-focused advocacy groups — including Rise Economy, the National Community Reinvestment Coalition, Main Street Alliance, and ReShonda Young (plaintiffs) — sued CFPB in D.C. federal court, alleging the bureau is unlawfully dismantling its Section 1071 final rule.
The 1071 rule is currently stayed by the Fifth Circuit. The stay only applies to the members of the American Bankers Association, Texas Bankers Association and the intervenors. On April 30, 2025, the CFPB announced it would not prioritize enforcement of the rule for institutions not covered by the Fifth Circuit’s stay. On June 17, 2025, the CFPB also issued an interim final rule extending the compliance deadlines (2025 IFR); the earliest that financial institutions must comply is July 1, 2026.
In their complaint, plaintiffs accused CFPB of violating the Administrative Procedure Act (APA) in four ways. First, they argued that CFPB unlawfully withheld and unreasonably delayed agency action by refusing to collect, maintain and publish data as required under Section 1071. Plaintiffs pointed out that the APA allows courts to compel agency action that is unlawfully withheld or unreasonably delayed.
Second, plaintiffs claimed CFPB exceeded its statutory authority. Plaintiffs argued that the APA requires courts to set aside unlawful agency actions that exceed statutory jurisdiction or are not in accordance with law. According to plaintiffs, CFPB knowingly adopted a broad policy of avoiding its statutory duty to enforce the Section 1071 Final Rule. Plaintiffs also asserted that CFPB lacks the statutory authority to disregard the specific requirements Congress imposed on financial institutions through Section 1071.
Third, plaintiffs argued that CFPB violated the APA by issuing the 2025 IFR without following the required notice-and-comment procedures. Plaintiffs acknowledged that an agency may skip notice-and-comment rulemaking if it finds, for good cause, that public notice and procedure are impractical or contrary to the public interest. Even so, Plaintiffs emphasized that CFPB lacked good cause to adopt a broad non-enforcement policy for Section 1071 without public input.
Finally, plaintiffs claimed CFPB violated the APA by acting arbitrarily and capriciously. Plaintiffs argued that, in adopting its non-enforcement policy and issuing the 2025 IFR, CFPB considered factors Congress did not authorize, ignored key aspects of the issue Congress directed it to address, and overlooked facts that supported the original Lending Transparency Rule. Plaintiffs also asserted that CFPB gave a misleading explanation that conflicted with its own actions, dismissed obvious alternatives, and harmed legitimate reliance interests.
Bottom Line: Plaintiffs ask the court to declare that CFPB violated the APA and Section 1071 and to vacate the 2025 interim final rule.
Document: Complaint
