The U.S. Senate has voted to overturn a Consumer Financial Protection Bureau (CFPB) rule that would have extended regulatory oversight to major tech companies offering digital payment apps and wallets, including Apple, Google, and X.
The resolution, introduced by Republican Senators Pete Ricketts and Mike Flood, passed along party lines under the Congressional Review Act. The measure now moves to the House of Representatives for further consideration. Finalized late last year, the CFPB rule aimed to ensure that nonbank financial service providers comply with the same federal regulations as traditional banks and credit unions. Companies such as Apple Pay, Google Pay, PayPal, and X, which has plans to expand into payments, would have been affected.
Critics of the CFPB rule, including X owner Elon Musk, have strongly opposed the regulatory expansion. Musk, a vocal critic of the agency, has backed efforts to limit its authority, posting "CFPB RIP" alongside a tombstone emoji on his platform. Senator Ricketts defended the push to overturn the rule, arguing that it imposes unnecessary regulations and stifles innovation. The Financial Technology Association also welcomed the Senate’s decision, stating that the rule lacked clarity, failed to define market risks, and improperly grouped different financial products under a single regulatory framework. Since the removal of CFPB Director Rohit Chopra early in the Trump administration, the agency, under acting Director Russell Vought, has scaled back enforcement actions, including lawsuits against major banks over fraud concerns related to the Zelle payment network.
The move to rescind the CFPB rule has sparked concerns among Democratic lawmakers. Senators Elizabeth Warren and Adam Schiff have called for an ethics investigation into Musk’s influence over regulatory decisions, particularly given his business interests in financial services through X and Tesla. In a letter to the Office of Government Ethics, they raised concerns that Musk’s advocacy against the CFPB could benefit his companies, including Tesla’s auto financing services. They emphasized that the CFPB plays a key role in protecting consumers from financial misconduct in industries like auto lending, and that Musk’s involvement in government regulatory matters warrants scrutiny. As the debate continues, the fate of the CFPB’s oversight authority now rests with the House of Representatives.
