On August 19, 2025, the CFPB announced that it had closed a multi-year investigation into a fintech company offering buy-now, pay-later financing for firearms. The Bureau stated that the matter would not proceed to settlement or litigation.
In a letter explaining the decision, the Bureau’s Chief Legal Officer concluded that the investigation “exemplifies the type of weaponization against disfavored industries and individuals” that current leadership intends to end. The letter described the probe as biased, politically motivated, and inconsistent with federal firearms regulations. Among other points, the CFPB’s letter cited the following transgressions allegedly committed by the agency under the previous administration with respect to the investigation:
- Targeting lawful commerce. Bureau staff allegedly pressed the company to abandon firearms financing as a condition of settlement.
- Excessive settlement demands. The proposed consent decree included significant monetary penalties and broad injunctive restrictions, which the Bureau said were intended to shut down the company’s firearms-related business.
- Conflict with federal law. Certain injunctive provisions would have required practices contrary to the Bureau of Alcohol, Tobacco, Firearms and Explosives’ guidance on firearm transactions.
- Political timing. Settlement demands were increased in December 2024, the same day the company’s parent announced the addition of a prominent political figure to its board of directors.
- Outside influence. The Bureau noted that a state attorney general with no jurisdiction over the company had been granted “unprecedented access and influence” in the investigation.
The Bureau concluded that the matter was not about consumer protection but instead about suppressing activity protected by the First and Second Amendments. The decision also invoked a recent Executive Order on debanking (previously discussed here), which prohibits politicized regulatory action against lawful businesses.
Putting It Into Practice: The closure of this investigation underscores the agency’s willingness to revisit past matters and scrutinize whether they were grounded in consumer protection law principles (previously discussed here). Financial institutions should expect fewer politically sensitive enforcement initiatives but continued oversight of core consumer finance compliance Monitoring the Bureau’s evolving enforcement philosophy will remain essential for companies across the sector.
