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A federal judge has mandated that the leadership of the Consumer Financial Protection Bureau (CFPB), appointed during Donald Trump’s presidency, suspend its initiative aimed at dismantling the agency. This ruling reflects a significant judicial response to efforts by the Trump administration to reduce the size and influence of federal agencies.
In a recent court filing, Judge Amy Berman Jackson ruled in favor of the union representing CFPB employees, who had sued acting director Russell Vought. The union’s concern centered around Vought’s plans to terminate a substantial portion of the bureau’s staff, a move that has been supported by personnel from Elon Musk’s Department of Government Efficiency, which has been reportedly involved in similar actions across federal agencies.
Judge Berman’s ruling explicitly states, “Defendants shall not terminate any CFPB employee, except for cause related to the individual employee’s performance or conduct; and defendants shall not issue any notice of reduction-in-force to any CFPB employee.” This order is a marked pushback against the administration’s broader trend of workforce reductions aimed at federal agencies deemed unfavorable by the political leadership.
This judicial intervention not only revitalizes the CFPB, a critical agency charged with safeguarding consumers in the nonbank financial sector, but it also appears to directly counter accusations from industry stakeholders who claim that the agency has operated beyond its intended authority under former director Rohit Chopra.
In addition, Judge Berman instructed Vought to restore all probationary and term employees who had been dismissed since his appointment, prohibit him from altering or destroying agency data, and annul a stop-work directive issued in February. The judge further insisted that CFPB employees must be provided with fully-equipped office spaces or authorized to work remotely to fulfill their official duties effectively.
The ruling emphasizes the need for the CFPB to maintain its consumer complaint portal and ensure timely responses to complaints. It also required Vought to reverse contract cancellations made under his directives and mandated a compliance report by April 4.
Specifically, Berman’s order extends responsibility to all leaders within the CFPB, as well as other individuals participating in related actions, specifically referencing personnel from the Department of Government Efficiency.
Following the ruling, a spokesperson for Vought did not immediately provide a response to requests for comments.
Warning Against Inaction
In a separate comprehensive opinion that addressed sensitive social media remarks by Musk, particularly his assertion on February 7 that the CFPB was essentially “RIP,” Judge Berman articulated her reasoning for granting the union’s plea for a preliminary injunction.
“The Court cannot look away or the CFPB will be dissolved and dismantled completely in approximately thirty days, well before this lawsuit has come to its conclusion,” she stated, highlighting the urgency of maintaining the agency’s integrity during ongoing legal proceedings.
The injunction she imposed is intended to preserve the CFPB’s operational powers, workforce, contract integrity, and data, effectively safeguarding the employees’ ability to conduct legally required activities until the case is resolved fairly.
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