The Trump administration has reportedly agreed to pause layoffs and funding cuts at the Consumer Financial Protection Bureau (CFPB) after a federal judge on Friday temporarily blocked the Bureau’s new Trump-appointed leadership from moving forward with an agency restructuring that includes mass employee firings.
U.S. District Judge Amy Berman Jackson halted the bureau from firing additional employees after the Administration fired more than 100 workers at the CFPB in early February, according to published reports.
Judge Jackson’s order is in response to a lawsuit brought by a CFPB employee union, with further hearings scheduled for March 3.
The judge’s order allows employees to be terminated only for performance-related reasons or misconduct. It also blocks the CFPB’s new leadership from destroying or removing CFPB data, including consumer complaints and other sensitive information collected by the bureau.
In addition, the order blocks the newly appointed CFPB leadership from defunding the agency.
The order states that the Trump administration “shall not delete, destroy, remove, or impair any data or other CFPB records,” except as permitted by federal law.
“It is further ordered that Defendants shall not terminate any CFPB employee, except for cause,” Judge Jackson’s order says.
On Feb. 1, Trump officials fired CFPB Director Rohit Chopra and installed newly confirmed Treasury Secretary Scott Bessent as the agency’s new acting director.
Bessent, in his first official action, ordered staffers to stop working and temporarily closed the CFPB’s headquarters.
Then, on Feb. 7, the Administration installed newly appointed Director of the Office of Management and Budget (OMB) Russell Vought as the agency’s new acting director.
Vought then halted all bureau activities, including the issuance of final rules and settlement enforcement actions, raising concerns about the bureau’s future.
On Thursday, the Administration announced that it had nominated Jonathan McKernan as the agency’s new permanent director. If confirmed by the Senate, McKernan will replace Vought.
“MBA congratulates Jonathan McKernan on his nomination to serve as director of the CFPB,” says Bob Broeksmit, CMB, president and CEO of the Mortgage Bankers Association, in a statement. “His deep experience as a regulator, in private practice, and on Capitol Hill – coupled with his background working on housing policy – make him a strong choice to lead the CFPB’s new direction under the Trump administration. “
“MBA looks forward to working with him and his staff to ensure that the agency operates within its statute to protect consumers in a manner that is transparent, fair, and supports competitive markets for financial products, including mortgages,” Broeksmit adds.
Photo: “cfpb 36794” by tedeytan is licensed under CC BY-SA 2.0
