Just hours after news outlet Government Executive reported the Consumer Financial Protection Bureau (CFPB) issued Reductions in Force (RIFs) for roughly 1,500 of its personnel—impacting amounting roughly 88% of its workforce—District Judge Amy Berman Jackson said that notices sent to those dismissed may have violated a court order restricting layoffs at the agency.
In addition to the RIFs, the Bureau reportedly slashed 50% of those responsible for inspection operations of the nation’s financial services companies. Employees were informed they would be locked out by 6 p.m. on April 18, and would be separated from federal service by June 16, barring qualifications for other available positions.
“Today’s bench order from Judge Jackson is a vindication for NTEU [National Treasury Employees Union] and its members, who wholeheartedly contend that the administration’s abrupt and chaotic RIF process does not serve the American people and is a deep violation of the rights of CFPB employees,” said National Treasury Employees Union (NTEU) President Doreen Greenwald in a statement. “Cutting over 80% of CFPB staff is not only unwise, it’s a direct attack on the financial security of millions of Americans. We will continue to advocate on behalf of the American people and NTEU members in court in response to President Trump’s war on civil servants and we aim to demonstrate that these frenzied, thoughtless attempts to shutter agencies that have done nothing but faithfully serve the American people are a detriment to the public good.”
In late March, in Civil Action No. 25-0381, National Treasury Employees Union v. Russell Vought (in his official capacity as Acting Director of the Consumer Financial Protection Bureau), the National Treasury Employees Union (NTEU) and other groups sued Acting CFPB Director Vought over dismantling the Bureau, arguing the effort violated the separation of powers between the branches of government.
A circuit court on April 11 partially stayed Judge Amy Berman Jackson’s order by allowing for RIFs after officials conduct an individual assessment to determine if the employee is necessary to fulfill the agency’s statutory responsibilities.
In her order filed April 18, Judge Jackson stated, “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.”
“The Trump Administration is sending another message to bad-acting big banks and other predatory institutions that it is open season on our nation’s working-class families. Not only that, but by letting non-banks, like fintechs, avoid oversight and accountability, they are effectively letting these companies off of the hook and creating an uneven playing field for community banks and credit unions,” said Rep. Maxine Waters, the top Democrat on the House Financial Services Committee, in a statement. “Under the lawless Trump Administration, financial institutions are free to scam, exploit, and abuse consumers so long as it boosts their profits. But just as we did in the D.C. District Court the first time, Democrats will keep fighting to block these harmful and unlawful actions and ensure the CFPB remains accountable to our nation’s consumers, not Trump and his billionaire allies.”
A hearing on the matter is scheduled for next Monday, April 28.
