The Trump administration suspends layoffs and cuts in funding at the Consumer Financial Protection Bureau (CFPB), CFPB, the federal agency responsible for cracking down on “junk” fees and answering complaints from consumers in the financial industry. I agreed to suspend the
In Friday’s order, U.S. District Judge Amy Berman Jackson said Trump officials have been forced to terminate workers, delete CFPB data and remove financial resources from raid agents, at least for now. He said he agreed to do so.
This is the latest move in a unfolding drama about the fate of the well-known federal watchdog, which Trump targeted the closure early in his second presidency.
The judge’s order states that the Trump administration should not “delete, destroy, delete or undermine data or other CFPB records.” “In addition, the defendant is ordered not to terminate CFPB employees except for the cause,” the order states.
On February 1, Trump officials fired CFPB director Rohit Chopra. They set up a new director, Russell Vought. Russell Vert immediately ordered the agency to stop work and close it.
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Elon Musk’s message about the future of the agency: “CFPB RIP”
Elon Musk, a billionaire who has cut the Beltway budget significantly, broadcasted Trump’s obvious intentions in a February 7 tweet, along with “CFPB RIP” and gravestone emojis.
The CFPB was established after the 2008 financial crisis to protect consumers from fraud. Modeled on an idea from Sen. Elizabeth Warren, a Democrat in Massachusetts, the agency has elicited sharp criticism from financial industry leaders and, more recently, from the new Trump administration.
In a February 8th post on X, Vault, the platform where much of the policy debate is unfolding, wrote that CFPB funding is “excessive.” He said, “This Spigot, which has long contributed to the CFPB’s inexplainable situation, is now off.”
But Federal Reserve Chairman Jerome Powell testified on Tuesday that “other federal regulators” exist to hold large banks accountable for following consumer protection regulations.
CFPB says it has regained $17.5 billion in consumer pocket
In its 2023 report, the CFPB said it had provided $17.5 billion cumulative “back in Americans’ pockets” compensation, cancelled debts and other consumer relief. Banking industry leaders argue that government agencies are far beyond the mission of Congress.
Among the recent CFPB actions:
The future of these initiatives is now in scope. Last week, Republican lawmakers introduced a law that overturned the $5 overdraft fee cap. They argued that higher fees “promote financial discipline and responsibility.”
CFPB Website Message: “Page not found”
On Sunday, the CFPB homepage conveyed a message that is becoming increasingly common on government websites. “404: Page Not Found.”
Government officials fired probation workers in emails on Tuesday, according to government officials, a publication targeting federal businesses. On Thursday, workers were issued a notice of fire on the contract, according to Reuters. These employees count about 200 of the 1,700 CFPB workforce, according to The New York Times.
The employee union filed a lawsuit to challenge the shutdown. In court Friday, the lawyer said Musk’s government ministry efficiency agents were afraid to delete long-standing valuable data.
In a court filing Friday, Ellie Meyer, the agency’s former chief technologist, said the pressing statement that “12 years of important CFPB records to which the public belongs will be lost in vain, causing serious and drastic damage.” “We warned of the risks that occurred.” The court will intervene.
The judge’s order will not require further dismissal or data purging until at least March 3rd until the date of the next court hearing.
Is CFPB good or bad? It depends on your political party.
The response to the CFPB shutdown is largely broken along party lines.
With the agency closed, “Congress can return the Consumer Protection Act to where it belongs to the real regulatory authority, rather than the unidentified and unexplained CFPB of Elizabeth Warren,” Kentucky Republican Rep. Andy Barr said. I wrote this in my post on February 12th X.
The next day, Warren tweeted a reference to a new payment platform that Musk is said to be developing.
“What institution do you think is making sure Elon’s new project cannot scam you or steal sensitive personal data?” Warren wrote. “CFPB.”
