A joint resolution providing for congressional disapproval under chapter 8 of title 5, United States Code, of the rule submitted by the Bureau of Consumer Financial Protection relating to the withdrawal of the rule relating to "Consumer Financial Protection Circular 2024-03: Unlawful and Unenforceable Contract Terms and Conditions".
- Bill Number
- S.J.Res. 128
- Origin Chamber
- Senate
- Congress
- 119th Congress, Session 2
- Policy Area
- Finance and Financial Sector
- Status
- Introduced
- Latest Action
- 2026-05-13: Motion to proceed to consideration of measure rejected in Senate by Voice Vote. (consideration: CR S2270-2271)
- Last Updated
- 2026-05-27T14:28:13Z
AI-Generated Summary
Purpose
This joint resolution (S.J. Res. 128) uses the Congressional Review Act (CRA)—a law allowing Congress to overturn certain federal agency rules—to disapprove a specific action by the Bureau of Consumer Financial Protection (CFPB), an agency that regulates consumer financial products like loans and credit cards. The goal is to block the CFPB's decision to withdraw its earlier guidance document, Consumer Financial Protection Circular 2024-03, which addressed unlawful or unenforceable terms in consumer financial contracts (e.g., hidden fees or unfair clauses).
Key Provisions
- Congress explicitly disapproves the CFPB's withdrawal rule, published in the Federal Register on May 12, 2025 (90 Fed. Reg. 20084).
- The original circular, published June 21, 2024 (89 Fed. Reg. 51955), declares certain contract terms unlawful under federal consumer protection laws like the Consumer Financial Protection Act.
- Once approved, the disapproval makes the withdrawal rule have no force or effect, reinstating the circular.
Significant Changes to Existing Law
- No new laws are created; instead, it reverses the CFPB's administrative action via CRA.
- Effectively restores the 2024 circular as active guidance, overriding the agency's attempt to pull it back.
Potential Impacts
- On government agencies: Limits CFPB's flexibility to revise its own guidance, subjecting future withdrawals to potential congressional override.
- On citizens (consumers): Strengthens protections against unfair contract terms in financial products, potentially making it easier to challenge deceptive practices in court.
- On businesses: Increases scrutiny on financial institutions (e.g., banks, payday lenders), requiring them to avoid or disclose certain contract clauses or risk CFPB enforcement.
- No direct impact on international relations.
Main Stakeholders Affected
- Consumers: Gain reinforced safeguards against exploitative contract language.
- Financial companies: Face heightened compliance costs and legal risks from reinstated CFPB guidance.
- CFPB: Loses authority over its withdrawn rule, highlighting congressional oversight of agency decisions.
- Congress: Demonstrates use of CRA as a tool to influence regulatory policy.
Notable Legal, Constitutional, or Political Implications
- Legal: Invokes CRA (5 U.S.C. Chapter 8), a fast-track process for disapproving rules; if enacted, it's not subject to judicial review. Reinforces that agency guidance like circulars can be treated as "rules" under CRA.
- Constitutional: Upholds Congress's oversight of executive agencies (Article I powers), checking unelected regulators.
- Political: Introduced by Sen. Cortez Masto (D-NV) in March 2026 and placed on the Senate calendar via petition (bypassing committee); signals partisan or bipartisan efforts to maintain consumer protections amid regulatory shifts.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Sen. Cortez Masto, Catherine [D-NV]
Recent Actions
- 2026-05-13: Motion to proceed to consideration of measure rejected in Senate by Voice Vote. (consideration: CR S2270-2271)
- 2026-04-27: Placed on Senate Legislative Calendar under General Orders. Calendar No. 384.
- 2026-04-27: Senate Committee on Banking, Housing, and Urban Affairs discharged, by petition, pursuant to 5 U.S.C. 802(c).
- 2026-04-27: Senate Committee on Banking, Housing, and Urban Affairs discharged, by petition, pursuant to 5 U.S.C. 802(c).
- 2026-03-17: Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.
- 2026-03-17: Introduced in Senate
Bill Versions
- Providing for congressional disapproval under chapter 8 of title 5, United States Code, of the rule submitted by the Bureau of Consumer Financial Protection relating to the withdrawal of the rule relating to Consumer Financial Protection Circular 2024–03: Unlawful and Unenforceable Contract Terms and Conditions. — issued 2026-03-17 — PDF (2 pages)
- Providing for congressional disapproval under chapter 8 of title 5, United States Code, of the rule submitted by the Bureau of Consumer Financial Protection relating to the withdrawal of the rule relating to Consumer Financial Protection Circular 2024–03: Unlawful and Unenforceable Contract Terms and Conditions. — issued 2026-04-27 — PDF (4 pages)