US Chamber of Commerce calls out CFPB in credit card lawsuit

US flag with digital overlay.
Image courtesy of

The US Chamber of Commerce (USCC) has filed a lawsuit to stop the Consumer Financial Protection Bureau (CFPB) from enforcing a rule that punishes credit card users.

Filing the lawsuit in the Northern District of Texas, the US Chamber of Commerce is seeking a preliminary injunction to prevent the CFPB from punishing responsible credit card users who pay their bills on time.

The USCC believes that the CFPB has overstepped its legal boundaries by issuing a rule to restrict credit card late fees, adding that it did so by using undisclosed data, which was gathered for a different purpose, thereby exceeding its statutory authority.

Neil Bradley, Executive Vice President, Chief Policy Officer, and Head of Strategic Advocacy of US Chamber, said: “American consumers benefit from a variety of credit cards that best suit their needs, and a large majority of credit card users understand the requirement to pay their credit card bills on time in addition to the costs that come with a late payment.

“By significantly limiting late fees, the CFPB is not only discouraging responsible credit card use but also imposing higher costs on consumers and limiting choices in credit card options and benefits.”

Among other arguments, the US Chamber and co-plaintiffs specifically are suing the CFPB for violating the Credit Card Accountability Responsibility and Disclosure Act (CARD Act) of 2009 by preventing issuers from collecting reasonable and proportional late fees when cardholders don’t pay their bills on time.

Additionally, CFPB faces legal action for breaching the Administrative Procedure Act (APA) by issuing a final rule that they consider “arbitrary” and “capricious”. This is alleged to have occurred through the CFPB’s reliance on undisclosed data collected solely from major banks for a different purpose and by a different agency.

Finally, the Chamber is suing the CFPB for issuing the rulemaking with funds drawn in violation of the US Constitution’s Appropriations Clause.

The co-plaintiffs involved are the Fort Worth Chamber of Commerce, Longview Chamber of Commerce, American Bankers Association, Consumer Bankers Association, and Texas Association of Business.

Bradley added: “The agency’s own analysis has found that by limiting late fees, associated costs will be passed onto all credit card users, even those who have never made a late payment. 

“The CFPB is acting outside its authority and the Chamber’s lawsuit seeks to protect American cardholders who pay their bills on time and enjoy the numerous benefits of diverse credit card offerings from America’s financial institutions.”