The Trump administration plans to fire almost all the staff at the Consumer Financial Protection Bureau and essentially shut down the agency, federal employees alleged in a court filing this month.
On Feb. 8, the National Treasury Employees Union filed suit against acting director Russell Vought in U.S. District Court in Washington, D.C., seeking to stop Vought from gutting and closing the bureau.
Vought was appointed acting director on Feb. 7 and immediately issued directives for the bureau to cease operations. CFPB has also been reportedly targeted to be wound down by the U.S. DOGE service, led by billionaire Elon Musk.
But the Trump administration has given mixed messages about the fate of the CFPB, which was founded in the wake of the financial crisis to protect consumer interests.
Jonathan McKernan, a former member of the FDIC board, has been nominated by President Donald Trump to be the permanent director.
In testimony on Wednesday before the Senate committee on Banking, Housing, and Urban Affairs, McKernan indicated the plan was to keep the agency open but scale it down. He said the CFPB has overreached and “gotten in the way of its own mission.”
Current CFPB employees, identified only as Alex Doe, Blake Doe, Charlie Doe and Drew Doe, indicated they were told of plans to wind down the agency in meetings with Adam Martinez, the CFPB’s chief operating officer.
“Drew Doe” described actions under Vought to “ensure that the bureau does not exist — to close down all agency systems, delete data, fire all the staff, and reduce the CFPB to a ‘room’ in another agency ‘with five men and a phone.’”
“Alex Doe” described meetings in which Martinez detailed plans to “carry out the closure of the agency.” “Blake Doe” details of meetings with Martinez for “wind down mode,” including transferring functions to other agencies and CFPB funds.
“Charlie Doe” described the “wholesale termination of contracts needed to keep the CFPB running.”
Adam Scott, the director of digital services, provided details about a decision to delete the Bureau’s homepage, that the decision was made by the Acting Director Vought, who didn’t allow staff to repair it. Matthew Pfaff, chief of staff of consumer response, said that the Consumer Complaint Databases is not being kept “intact and operational.”
Brian Shearer, head of policy planning, also detailed how “atypical” the dismantling of the Bureau is compared to other transitions.
CFPB recently dropped at least four enforcement lawsuits, including cases against an affiliate of Rocket Mortgage and one of the nation’s largest manufactured home lenders.
The CFPB dismissed with prejudice cases against Rocket Homes Real Estate, Vanderbilt Mortgage & Finance, Capital One and the Pennsylvania Higher Education Assistance Agency.
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