Trump Order Targets Independent Agencies: What the Fed, FEC, and CFPB Could Lose

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On February 18, 2025, President Trump signed an order that requires agencies that Congress deliberately set up to operate independently—the Federal Reserve, the Federal Election Commission, the Consumer Financial Protection Bureau, and others—to submit their proposed rules to the White House for approval before they can take effect. The order eliminates exemptions that administrations have maintained for decades, based on the idea that Congress deliberately created these agencies to operate without direct presidential control. Legal experts have questioned whether this marks the end of the nearly 140-year era of independent regulatory agencies.

Banking rules that would protect community lenders are stuck in limbo. Consumer protections that could save Americans billions in unfair charges like overdraft fees or payday loan interest face indefinite delays. Election regulations that determine what campaign spending is legal now require White House sign-off—meaning the president gets to approve the rules governing his own reelection.

The order’s language sounds technical: agencies must submit major new rules (like banking standards or lending protections) to the White House regulatory review office (which we’ll call OIRA). But what that means in practice is that a small office in the White House now controls whether the Fed can finalize bank capital standards, whether the CFPB can stop payday lenders from draining borrowers’ accounts, whether the FEC can clarify what counts as illegal campaign coordination.

Which Agencies Lost Their Independence

Executive Order 14215 swept in agencies that have operated independently for decades: the SEC, the FCC, the CFTC, the FDIC, the Fed’s banking regulators, the CFPB. All of them now answer to the White House’s review office before they can finalize rules.

Within six months, nearly all major regulators had begun submitting rules to OIRA. Agencies now build White House approval into their planning from the start. They’re not checking whether a rule meets what the law requires anymore. They’re asking: will this survive White House review? Will we need to water it down? Should we even bother proposing it?

Why the Fed Can’t Separate Monetary Policy From Bank Supervision

The Fed can still set interest rates without White House approval, but the order tries to separate monetary policy from bank supervision.

Bank capital requirements determine how much credit banks can extend. Credit availability affects the money supply. The money supply is monetary policy. If the White House can pressure the Fed to lower capital standards—presented as cutting unnecessary red tape—it’s effectively forcing monetary stimulus without officially announcing it. The Fed Chair might resist in the name of financial stability, but under this order, resistance gets harder when the White House can simply approve a rule the Fed opposes.

When the President Reviews His Own Election Rules

The Federal Election Commission’s inclusion in the order creates the most obvious conflict: the sitting president now gets to approve rules governing campaign finance in his own reelection.

The FEC is already broken. Six commissioners serve staggered terms so no single president can appoint all of them, no more than three from one party, to prevent one party from controlling it, and the agency requires four votes to take action. This design was supposed to prevent either party from weaponizing election enforcement. Instead it’s produced decades of 3-3 ties that prevent the agency from taking action on major enforcement decisions.

But even a deadlocked FEC could issue advisory opinions—narrow legal guidance on specific questions—through temporary compromises between commissioners. Trump’s order threatens to eliminate even that. If the White House can declare its interpretation of campaign finance law “controlling,” it can effectively freeze FEC guidance that contradicts administration preferences.

Imagine this scenario in 2028: A campaign wants FEC guidance on whether certain coordination with outside spending groups is legal. The FEC staff drafts an opinion saying it’s not. But the White House legal team disagrees, and under the order, the White House interpretation controls. The FEC can’t issue guidance. The campaign proceeds with the coordination. No one knows if it’s legal until someone sues, months after the election.

The Consumer Protection Rules That Aren’t Happening

The Consumer Financial Protection Bureau faces the most direct threat because its rules create measurable costs for the financial industry—an industry that donates heavily to political campaigns and lobbies aggressively against regulation.

The CFPB has worked on rules that would require banks to make consumer financial data available in formats consumers could transfer to a different bank—letting you move your banking data to a competitor the way you can move your phone number between carriers. Banks argue the cost to banks of following the rule is higher than the money it saves consumers. Under OIRA review, that argument gets a White House audience that previous CFPBs didn’t have to satisfy.

A March 2025 rule protecting payday loan borrowers finally took effect after years of litigation. It stops lenders from making repeated unauthorized withdrawals from borrowers’ accounts after two failures—a practice that generated billions in overdraft fees. That rule was adopted in 2017, fought in court by payday lenders, and only became enforceable eight years later.

Under the new framework, future payday lending protections would face White House OIRA review that might conclude the cost to banks of following the rule is higher than the money it saves consumers. The payday lending industry argues that stricter oversight reduces collecting money from borrowers, forcing lenders to charge higher interest rates. That argument—that protecting individual consumers from predatory practices harms consumers generally—is exactly the kind of analysis that OIRA review could resolve against consumers.

The CFPB’s 2024 debt collection report documented widespread violations: collectors failing to send required validation notices, making false representations about debts, using false or incomplete paperwork in lawsuits to collect debts. Future rules tightening these requirements could be blocked through OIRA review, with the administration arguing compliance costs exceed benefits.

Every month these rules remain in limbo, consumers keep paying fees that future regulations might eliminate. The costs are measurable: billions of dollars annually across payday lending, overdraft fees, and debt collection practices the CFPB has documented as predatory.

How White House Review Works

OIRA has existed since 1981 as a centralized review office for rules from different government agencies. It’s supposed to ensure cost-benefit analysis meets standards and that agencies coordinate to avoid conflicts.

In practice, OIRA has evolved into a place where rules can be modified, delayed indefinitely, or blocked by simply not sending them back to the agency. For traditional agencies, this represents presidential oversight. For agencies that Congress deliberately set up to operate independently, it’s something different: a mechanism for the president to impose policy preferences on agencies that Congress explicitly structured to resist presidential pressure.

Agencies are asking the White House for feedback before officially proposing rules, inviting White House input at earlier stages. The formal review timeline doesn’t include the months rules spend in development while agencies second-guess whether proposed standards will survive White House scrutiny.

An October 2025 OIRA memorandum on “Streamlining the Review of Deregulatory Actions” clarified the approach: 14-day timelines for rules deemed clearly illegal on the surface and streamlined consultation that skips normal coordination with state governments and tribal authorities.

Adding substantial rulemaking output from agencies that Congress deliberately set up to operate independently creates obvious bottlenecks. The Federal Reserve publishes dozens of significant banking regulations annually. The SEC runs one of government’s most prolific rulemaking programs. If each proposed rule requires OIRA review, either OIRA must expand dramatically or rules face longer waits.

The solution emerging in practice: asking for feedback before officially proposing rules, informal pressure to revise proposals, and occasional indefinite delays for politically challenging rules.

The Stress Test Problem

The Federal Reserve’s 2026 stress test scenarios illustrate how this works concretely. These annual tests determine capital requirements for large banks, effectively constraining credit availability throughout the economy.

Stress tests are highly technical: computer simulations that test how banks would survive a financial crisis, projections about how severe a recession might be, predictions about how banks would perform during a crisis. The Fed normally finalizes these scenarios according to technical judgment about what appropriately tests bank resilience.

But if stress test scenarios require OIRA review, the White House can pressure the Fed to adopt less severe scenarios, reducing required capital levels and expanding credit. The banking industry has explicitly called for stress test modifications that reduce capital requirements—framed as transparency and consistency needs rather than explicit requests for easier standards.

OIRA review creates a mechanism for those preferences to shape final outcomes. The 2026 scenarios underwent the Fed’s normal notice-and-comment process, but evidently involved extensive White House coordination not typical of previous stress test development.

Legal Challenges and Constitutional Questions

The Democratic National Committee challenged the order’s application to the FEC in early 2025, arguing it violates the Federal Election Campaign Act’s provisions requiring FEC legal judgment to remain independent. The district court initially declined to enjoin the order, but the Trump administration subsequently disclaimed intent to override FEC legal judgments, leading to dismissal while preserving the court’s authority to act if the approach changes.

The structural vulnerability lies in trying to reconcile presidential authority with independence protections written into law. The Federal Reserve, FEC, and CFPB all possess independence protections written into law that Congress explicitly created. A Supreme Court case ruled that the president can fire the CFPB director, but that concerned only removal, not authority to direct agency legal interpretations before rulemaking.

Congress granted these agencies specific authority to create regulations according to procedures Congress set up. An order can’t easily override that authority.

If Trump’s order proves constitutionally sound, a Democratic administration could use identical OIRA review authority to block banking deregulation, strengthen environmental regulations Trump reviewers blocked, and expand consumer protections business interests oppose. A mechanism for presidential control over agencies that Congress deliberately set up to operate independently, once established, becomes available to presidents of either party.

The Fed’s Deepest Vulnerability

The Federal Reserve faces institutional jeopardy because the monetary policy exemption in the order can’t meaningfully separate monetary policy from rules to keep banks safe and stable.

If a court scrutinizes whether Fed banking supervision remains protected from the president’s influence, it will confront the uncomfortable truth that bank capital requirements, stress testing standards, and leverage ratios all directly affect the total amount of money in the economy and credit availability.

A court holding these functions fall within “supervision and regulation” rather than “monetary policy” effectively guts the order’s monetary policy exemption, making Fed monetary policy vulnerable to White House review. Conversely, a court holding these functions constitute monetary policy would require reconstructing the order’s language to clarify what aspects of Fed supervision remain subject to review—undermining the order’s current operation.

In June 2024, the Supreme Court overturned the rule that courts should trust agencies’ interpretations of laws. As courts withdrew deference protecting agency authority from judicial second-guessing, the White House asserted direct control over agency rulemaking through OIRA review.

Agencies face simultaneous pressure from three directions: courts now second-guess how agencies interpret laws, the White House pre-screens rules before publication, and legal constraints Congress imposed when creating agencies that Congress deliberately set up to operate independently. For agencies that Congress deliberately set up to operate independently, this convergence threatens their authority, because the rationale for agency independence rested partly on the assumption that agency expertise would receive deference from both courts and the White House.

What’s Already Frozen

The Fed’s stress testing framework faced delays and modification requests suggesting White House questioning of scenario severity. While the Fed ultimately released 2026 scenarios in February 2026, the process evidently involved extensive White House coordination not typical of previous stress test development.

The CFPB’s personal financial data rights rulemaking remained in indefinite limbo as of early 2026, with the CFPB having released a preliminary announcement but facing unclear timelines for proposing final rules. Financial industry lobbying organizations explicitly called for strict analysis, arguing compliance costs would exceed consumer benefits—an argument White House OIRA review would likely assess seriously.

The Fed’s proposal to adjust how much money community banks must keep in reserve faced OIRA review that slowed finalization compared to typical Fed rulemaking timelines. Community banks remained in limbo, unable to confidently plan capital strategies around expectations that should have been finalized on predictable schedules.

The FEC’s agenda as of early 2026 showed relatively few proposed rulemakings under active development—possibly reflecting institutional awareness that rules would face White House review previous FECs didn’t experience.

What the Order Means in Practice

Trump’s order represents a test case about whether Congress’s ability to structure agencies that operate independently survives in an era where presidents assert the power to direct all government agencies.

The order assumes agencies exercising power must ultimately answer to the president. This theory conflicts with Congress’s demonstrated belief that certain functions require protection from the president’s influence—a belief Congress codified when creating the Fed’s independence in 1913, restructuring the FTC in 1935, creating the SEC in 1934, and establishing the FEC’s independence in 1974.

Projects remain frozen or indefinitely delayed as agencies work through uncertainty about White House approval timelines. Industries opposing new regulations effectively gain a second approval mechanism where they can lobby White House officials to block or delay rules they oppose.

Consumers awaiting protections from payday lending, data portability rights, and other safeguards face continued exposure to practices agencies would prefer to restrict. Financial markets price in reduced expectations about future banking regulation, potentially affecting credit terms and asset prices. The FEC’s persistent dysfunction persists without any mechanism to move beyond deadlock between the two parties, while campaigns face legal uncertainty about what spending practices comply with election law.

Rules that should be protecting consumers aren’t getting published. Banking standards that should be preventing the next financial crisis are stuck in White House review. Election regulations that should be clarifying what’s legal in the 2028 cycle require presidential approval.

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