Leadership at the Consumer Financial Protection Bureau plans to recall staff to the agency’s office more than a year after the Trump administration shuttered its Washington headquarters and tried to eliminate the workforce, Reuters reported, citing three people with knowledge of the matter.
The return-to-office plan for the consumer finance watchdog has not been announced to staff, and timing remains uncertain, according to the report.
Currently, the CFPB’s downtown headquarters are partly occupied by the Office of Management and Budget, whose Director Russell Vought also leads the CFPB. It was unclear whether staff would be recalled to CFPB headquarters and whether the mandate would include agency staff based outside Washington, Reuters’ sources said.
The Trump administration in February canceled the lease on the CFPB’s headquarters and handed the property to the General Services Administration.
After calling for the CFPB’s outright elimination last year, Reuters reported that administration officials now say they have scaled back plans to cut the agency’s workforce. A federal judge’s provisional order blocking that is still in place after a lower court previously found that the administration planned to wipe out the CFPB before the legal system could decide whether that was legal.
Many Workers Have Left
Many CFPB workers have left the agency, which was created following the 2008 financial crash to protect the public from predatory practices in consumer finance. Reuters reported that the agency’s headcount is down about 30% since the start of the Trump administration, citing court filings.
Top administration officials, including Trump, have called the CFPB a politicized burden on free enterprise, while Democrats and agency defenders have described efforts to eliminate it as a giveaway to corporations at the expense of consumers.
In a separate issue, the Trump Administration announced it is appealing a California federal court order that required the CFPB to continue drawing operating funds from the Federal Reserve. The move escalates a legal battle over whether the agency can effectively be defunded without action from Congress.
The appeal follows a March ruling by U.S. District Judge Edward Davila in California, who said the administration unlawfully refused to seek funding for the CFPB after Acting Director Russell Vought argued the agency could not access Fed funding because the central bank was operating at a loss.
The judge ordered the agency to continue requesting money from the Fed “indefinitely,” marking the second major court rebuke of the administration’s effort to halt the Bureau’s operations.
A New Appeal
The Administration filed its appeal this week with the Ninth Circuit.
The appeal argued the lower court improperly forced the executive branch to continue funding the consumer watchdog. The CFPB’s funding structure has been at the center of numerous political and legal battles since Trump returned to office and moved aggressively to shrink the CFPB’s operations and staffing.
CU Today noted that the renewed court fight comes even after the U.S. Supreme Court last year upheld the CFPB’s unique funding mechanism in a separate case, ruling Congress lawfully authorized the CFPB to receive funding directly from the Federal Reserve rather than through annual appropriations.
Republicans Shoot Down Measures
On Wednesday, Senate Republicans shot down more than a dozen measures backed by Democrats to undo the administration’s dismantling of the CFPB, The Hill reported.
Democrats forced votes on multiple resolutions that targeted rules and regulatory changes made during President Trump’s second term, including resolutions on CFPB’s policy on overdraft fees, credit report privacy, and mortgage lending, among others.
The Hill reported that some of the proposals failed in roll-call votes, with Sen. Susan Collins (R-Maine) crossing party lines to join Democrats on two of the three resolutions.
Republicans defeated the remaining resolutions by voice vote, the Hill said.
According to The Hill’s report, Collins sided with Democrats on a measure introduced by Sen. Raphael Warnock (D-Ga.) to restore CFBP’s rule restricting medical debt collections, a Biden-era rule that allowed medical debt to be wiped from credit reports. A Trump-appointed federal judge reversed it last July after finding it exceeded the CFBP’s authority.
