Update: The plaintiffs voluntarily dismissed their lawsuit against the Trump administration on May 15, 2026. The dismissal came after the Consumer Financial Protection Bureau on May 1 issued a revised lending transparency rule that substantially narrows the 2023 rule the plaintiffs had asked the court to enforce.
Original article:
A Waterloo business owner who successfully sued the first Trump administration is back again for round two.
ReShonda Young, an entrepreneur who started out selling popcorn and now is working to launch Iowa’s first Black-owned bank, is one of several plaintiffs in a lawsuit filed this week against the Consumer Financial Protection Bureau.
Young is accusing the agency and its Trump-appointed acting head of unlawfully moving to scrap lending transparency regulations meant to help disadvantaged business owners.
Young had previously sued the CFPB for dragging its feet on creating the rule in 2019, during Trump’s first term, in a case that ended with the agency agreeing to move forward with enacting the official regulation.
Upon returning to office, one of Trump’s first actions was to issue stop-work orders at CFPB, and his appointees have since been working to gut the agency, laying off staff and slashing its budget.
Trump himself has described the agency as “a very important thing to get rid of.” A federal court in Washington, D.C., has ordered the administration to pause many of these actions, and litigation is ongoing.
Young’s complaint, filed by legal advocacy group Democracy Forward, alleges that Trump’s appointees are also, once again, unlawfully delaying the lending transparency rule.
And so, once again, the Waterloo businesswoman is suing the government to force it to enact rules ordered by Congress more than 13 years ago.
A winding history for bank regulation
The rule in question was mandated by the 2010 Dodd-Frank reform law. The specific provision requires financial institutions to collect and report to the government data on loans to women- and minority-owned businesses and small businesses, which would then be made available to the public.
As laid out in the latest complaint, the CFPB, which was founded in the same law, did not begin preliminary research and outreach to stakeholders about the requirement until 2016. In 2018, after two years of studies and roundtable discussions, the agency hit the brakes and paused work on the rule indefinitely.
Young, joined by several small-business and economic equality advocacy groups, sued the following year, accusing the agency of unlawfully withholding the proposed regulation in violation of the 2010 law. The following year, the CFPB agreed in a settlement to undertake a formal rulemaking process as required by statute.
The resulting final rule was adopted in August 2023, but it did not immediately take effect. Instead, it set a compliance deadline of October 2024, later pushed to July 2025, for large banks, and January 2026 for smaller lenders. Several banking industry groups have sued to block the rule, but until Trump took office in January, the rule remained on track to take effect.
Lawsuit accuses new administration of further delay
Under Trump, though, the agency has abandoned defending the rule in several lawsuits and postponed deadlines by another year, the plaintiffs say. Officials announced in June they intend “to issue a new proposal to reconsider certain aspects of the 2023 final rule.”
The plaintiffs argue that Trump’s appointees are acting illegally in postponing and attempting to rescind the regulation without proper process or justification.
“The Trump-Vance administration wants to achieve through acquiescence in court litigation and regulatory evasion what they could not do through proper rulemaking: block implementation of a critical transparency and accountability tool to help people and small businesses thrive,” Democracy Forward President and CEO Skye Perryman said in a press release.
Waterloo plaintiff describes need for transparency
In the complaint, Young describes personal experiences with being denied access to capital.
Her father had to have a White employee buy the first truck for his transportation company because no bank would offer him a loan, she said.
Her own first business, Popcorn Heaven, was hampered at launch by difficulty obtaining loans; when she sold the flagship business to a White buyer four years later, that buyer was able to quickly obtain loans for more than twice as much as Young was ever offered. She was denied loans again when she and a Black business partner sought to purchase a health store this year.
Young is now working to launch the Bank of Jabez, a new bank focused on underserved communities and expected to begin operations by the end of 2025.
Access to the lending data CFPB is supposed to be collecting would be of “tremendous use” to her as both a business owner and banker, she says, allowing her to “avoid wasting her time working with banks that have a history of excluding Black and female business owners” and “identify markets and communities that may particularly benefit from the Bank of Jabez’s services.”
“I’ve heard bankers say the (loan transparency) rule creates too much work and costs too much money for them to adhere to,” Young said in a statement through Democracy Forward. “For those of us who are unfairly denied equal access to capital, banks not adhering to the 1071 ruling has hefty costs for us too.”
The lawsuit was filed in federal district court in Washington, D.C. The CFPB has not responded to the complaint.
William Morris covers courts for the Des Moines Register. He can be contacted at wrmorris2@registermedia.com or 715-573-8166.
This article originally appeared on Des Moines Register: Iowa banker suing Trump administration for blocking lending transparency rule
Reporting by William Morris, Des Moines Register / Des Moines Register
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