Trump Administration Must Shut Down Biden-Era CFPB Overdraft Power Grab

Originally posted to X.

The Biden administration may be over, but the wreckage of its command-and-control economic policies still lingers. Among the most dangerous leftovers is the Consumer Financial Protection Bureau’s (CFPB) proposed overdraft rule—a relic of Biden-era price controls that would destroy financial choice for millions of Americans. It’s now up to the Trump administration and Congress to stop it.

The rule, cooked up under Biden’s watch by CFPB Director Rohit Chopra—an ideological disciple of Senator Elizabeth Warren—would cap overdraft fees at just $5. The left framed it as “consumer protection,” but let’s be honest: This is pure government overreach. It’s a backdoor attempt to micromanage banking and eliminate financial tools that lower-income Americans actually choose and use.

As Breitbart reports, the rule is ripe for repeal under the Congressional Review Act. The Trump administration and Congress must act swiftly to ensure it never sees the light of day.

The data are clear: overdraft protection is a voluntary service that roughly 23 million U.S. households use annually. These families often rely on it as a short-term bridge to cover essentials—gas, groceries, rent—between paychecks. As Pinpoint Policy Institute notes, “consumers choose overdraft protection when they believe the fee is worth avoiding a declined transaction or bounced check.” That’s freedom of choice. And yet, under Biden’s CFPB, that choice came under attack.

Let’s not sugarcoat it: this is government-mandated price fixing. And price controls never work—they always result in shortages or the elimination of services. In this case, the CFPB rule would guarantee that banks stop offering overdraft protection. When a service costs more than what regulators allow you to charge, the rational response is to stop offering it. That’s not just bad policy—it’s basic economics.

This rule was never about protecting consumers. It was about expanding federal control over financial markets. It fits the broader Biden-era pattern of demonizing legal fees, punishing private enterprise, and growing the regulatory state under unelected bureaucrats. Chopra’s CFPB has acted as a rogue agency from day one—accountable to no one, including Congress, thanks to its unique funding structure that bypasses the appropriations process.

I’ve long warned against this kind of unchecked regulatory power (see here and here). The Trump administration now has the responsibility to reverse course. Congress must back it up with the full weight of the law by striking down this rule through the Congressional Review Act.

Doing so isn’t just about overdrafts—it’s about restoring trust in the market and putting Americans, not bureaucrats, back in control of their finances. If this rule goes into effect, it will hit those on the margins hardest. When overdraft protection disappears, what replaces it? Higher bounced-check fees? Closed accounts? Riskier payday loans?

This rule was born out of a mindset that believes Washington knows best. But real consumer protection comes not from micromanagement, but from competition, transparency, and choice. Let people decide what financial tools are right for them—not a distant federal agency chasing ideological goals.

The Trump administration has a clear opportunity to correct course. It can defend the basic principles of free-market banking, stop harmful Biden-era policies before they do more damage, and send a clear message: The days of unelected regulators choking off consumer choice are over.

Let people prosper. That starts by killing this rule, cutting the CFPB back down to size, and restoring financial freedom for all Americans.