In Washington, a federal judge has temporarily halted President Donald Trump’s sweeping plan to downsize the Consumer Financial Protection Bureau (CFPB). Judge Amy Berman Jackson expressed serious concerns over the administration’s approach, describing their actions as potentially dismissive of the judiciary’s authority.
The CFPB was established following the Great Recession to protect consumers from deceptive practices. However, the Trump administration contends that the bureau has been overstepping its bounds, advocating for a more constrained role.
Recently, administration officials announced a plan to dismiss approximately 1,500 employees, leaving just 200 personnel, as part of a significant reduction in the bureau’s scale. This prompted Judge Jackson to intervene, citing the plan’s potential violation of prior court rulings. Jackson warned that if these measures proceeded unchecked, they could effectively dismantle the CFPB, hindering its legal obligations.
This standoff is part of a broader pattern of friction between the executive and judicial branches as President Trump seeks to exert his presidential influence. Judge Jackson noted in her order that there was reason to believe the administration might be disregarding judicial decisions consciously.
A hearing is scheduled for April 28, where officials involved in this reduction in force (RIF) will provide testimony. During a recent session, Judge Jackson emphasized that she would not permit the RIF to advance until the issue is thoroughly resolved through legal channels.
President Trump’s efforts to reform the federal bureaucracy, which he claims suffers from inefficiencies, have consistently faced legal challenges. Many such initiatives, including staff downsizing and policy changes, have encountered litigation obstacles.
Businesses and Trump advisers, particularly Elon Musk leading the Department of Government Efficiency (DOGE), have long viewed the CFPB’s regulatory activities as burdensome. Mark Paoletta, the bureau’s chief legal officer, testified that the CFPB’s actions exceeded legal boundaries, describing them as intrusive.
According to Paoletta, strategies have been devised to streamline the CFPB’s operations, focusing on appropriate enforcement within a smaller framework. The current proposal recommends reducing the enforcement division’s staff from 248 to 50 and trimming the supervision team from 487 to 50, with headquarters moving from Washington to the Southeast.
Amid this reshuffling, concerns have surfaced from within. An anonymous employee, referred to as Alex Doe, claimed in a sworn statement that Gavin Kliger, associated with DOGE, pressured the RIF task force to expedite layoff notices, often through aggressive means. DOE employee testimonials alleged that these moves disregarded mandatory individual assessments prior to implementing the RIF.
Adam Martinez, the CFPB’s Chief Operating Officer, testified that Kliger does not work directly for DOGE, but is rather on loan from the Office of Personnel Management. Judge Jackson has instructed Kliger to attend the upcoming hearing to clarify his role and responsibilities during the RIF process.
The pseudonymous employee’s account suggests team members were told by Paoletta to disregard procedural requirements for the RIF, with leadership assuming associated risks. The White House has yet to comment on these developments.
An OPM spokesperson denied allegations of Kliger managing the RIF, framing the claims as part of an attempt to undermine DOGE’s objectives. This individual requested anonymity, being unauthorized for public commentary on the matter.