Elon Musk holds up a chainsaw onstage throughout the Conservative Political Motion Convention (CPAC) in Nationwide Harbor, Maryland, U.S., February 20, 2025.
Nathan Howard | Reuters
The Shopper Monetary Safety Bureau’s Trump-appointed management plans to fireplace almost all its 1,700 staff whereas “winding down” the company, in accordance with testimony from staff.
In a trove of statements launched late Thursday, federal staff stated that the mass layoff was mentioned in conferences they attended this month with senior CFPB leaders and members of Elon Musk’s so-called Division of Authorities Effectivity.
“My group was directed to help with terminating the overwhelming majority of CFPB staff as rapidly as potential,” stated an worker recognized as Alex Doe, a pseudonym used out of worry of retaliation.
Doe stated the plan from CFPB leaders and DOGE was to chop the bureau’s workforce in three phases. It could first get rid of probationary and time period staff, then perform a wave of about 1,200 layoffs, leaving a skeleton crew of some hundred staff.
“Lastly, the Bureau would ‘cut back altogether’ inside 60-90 days by terminating most of its remaining employees,” Doe stated.
The employees’ testimony comes at an important time for the CFPB, the company created to guard customers after the 2008 monetary disaster attributable to irresponsible lending. Since DOGE operatives first arrived on the CFPB this month, the bureau has shuttered its Washington headquarters, initiated the primary spherical of layoffs and instructed those that stay to cease almost all work.
The division has additionally reversed course on a number of circumstances the place it accused monetary corporations together with Capital One of ripping off prospects, dismissing at the very least 4 circumstances Thursday involving billions of {dollars} in alleged client hurt.
The filings containing the worker statements had been made within the case began by a CFPB union, which led to a decide suspending appearing Director Russell Vought’s strikes to shutter the bureau. After the CFPB fired about 200 probationary and time period staff, the company’s actions had been placed on maintain till a March 3 listening to.
‘5 males and a telephone’
The paperwork present an obvious disconnect between a few of the exterior messaging from Vought and the behind-the-scenes exercise on the bureau.
In a movement filed Monday within the case, Vought pushed again in opposition to the concept that he deliberate to get rid of the CFPB.
“The predicate to working a ‘extra streamlined and environment friendly bureau’ is that there’ll proceed to be a CFPB,” he wrote.
However the Trump administration’s plan was to take the CFPB all the way down to the barest minimal staffing required beneath legislation: Simply 5 CFPB staff would stay, both in a stand-alone workplace or folded into one other regulatory physique, the employees testified.
In conferences between Feb. 18 and Feb. 25, “employees had been instructed by Senior Executives that the CFPB can be eradicated apart from the 5 statutorily mandated positions,” stated one other present CFPB worker, this one recognized as Drew Doe.
“One Senior Government stated that CFPB will change into a ‘room at Treasury, White Home, or Federal Reserve with 5 males and a telephone in it,'” Doe stated.
One other CFPB worker stated that she or he attended a Feb. 13 assembly by which the bureau’s chief working officer, Adam Martinez, said that the company was in “wind-down mode.”
The CFPB staff stated that, if directed to by the courtroom, they would offer their names and titles beneath seal.
DOGE position
The bureau has lengthy been a goal of Republicans and monetary establishments, who’ve referred to as it a rogue company that exceeded its authorized authority in punishing firms. Extra just lately, Musk has taken up the trigger; he posted on his X platform, “RIP CFPB,” earlier this month simply as his DOGE operatives started their work.
In a number of cases within the testimony, senior CFPB employees appeared to defer to DOGE staff for vital issues.
As an example, DOGE employee Jordan Wick “particularly said” that Musk’s advert hoc group wished an enormous spherical of layoffs by Feb. 14.
“The Bureau meant to conform and hearth the overwhelming majority of remaining staff on February 14th,” Alex Doe stated. “The one purpose it didn’t accomplish that is due to this Court docket’s order.”
In different cases, DOGE staff requested CFPB employees about how deeply they may lower operations whereas adhering to statutory necessities in areas like client response, per testimony from CFPB employee Matthew Pfaff.
Regardless of gaining full entry to CFPB programs and knowledge on Feb. 7, the DOGE staff have not but accomplished the cybersecurity and privateness coaching required by the company, the staff testified.
Authorized necessities
Whereas Musk and Vought have brazenly advocated for the termination of the CFPB, solely Congress can actually shutter the company, which was created after lawmakers handed the 2010 Dodd-Frank Act.
Vought’s strikes seem to permit him to say the CFPB nonetheless exists, whereas sidelining its position by drastically curbing its skill to oversee firms and reply to complaints.
CFPB staff query whether or not a handful of staff may credibly fulfill the handfuls of statutory necessities of the company, which embrace responding to tens of millions of client complaints filed through net and telephone traces, in addition to sustaining advocacy workplaces for navy veterans and senior residents.
On Thursday, Jonathan McKernan, President Donald Trump’s choose to take over on the CFPB for Vought, instructed lawmakers together with Sen. Elizabeth Warren, the Massachusetts Democrat credited with spurring the company’s creation, that he would “absolutely and faithfully” implement legal guidelines associated to the CFPB’s mission.
McKernan added that if confirmed by the Senate, he would “rightsize” the CFPB, in addition to “refocus it” and “make it accountable.”
Noting that Vought, who can also be head of the Workplace of Administration and Price range, has canceled the lease on the company’s headquarters, Sen. Jack Reed, D.-R.I., instructed McKernan that he was in a “very tough place.”
“You don’t seem to have a lot presidential assist or OMB assist, and I’ve this sinking feeling that you just’re departing Liverpool on the Titanic,” Reed stated. “Good luck.”
