WASHINGTON (news agencies) — A federal judge agreed Friday to block the Trump administration from dismantling the Consumer Financial Protection Bureau, an agency that was targeted for mass firings before the court’s intervention.
U.S. District Judge Amy Berman Jackson agreed to issue a preliminary injunction that maintains the agency’s existence until she rules on the merits of a lawsuit seeking to preserve the agency. The judge said the court “can and must act” to save the agency from being shuttered.
Jackson ruled that, without a court order, President Donald Trump’s administration would move quickly to shut down the agency that Congress created in the wake of the 2008 financial crisis.
“If the defendants are not enjoined, they will eliminate the agency before the Court has the opportunity to decide whether the law permits them to do it, and as the defendants’ own witness warned, the harm will be irreparable,” Berman Jackson said in her order.
Deepak Gupta, an attorney for the plaintiffs, said in a statement that the ruling “blocks the unprecedented plan to dismantle the CFPB — an agency that Congress created to protect Americans’ financial security. This ruling upholds the Constitution’s separation of powers and preserves the Bureau’s vital work.
“We’re heartened by the decision and look forward to continuing to press our case in court,” Gupta said.
During a March 10 hearing, Jackson heard testimony about the chaos that erupted inside the agency after government employees were ordered to stop working last month. The bureau’s chief operating officer, Adam Martinez, said the agency was in “wind-down mode” after Trump fired its previous director, Rohit Chopra, on Feb. 1.
Trump installed a temporary replacement who ordered the immediate suspension of all agency operations, cancelled $100 million in contracts and fired 70 employees.
Martinez said the agency’s current leaders have adopted a more methodical approach than they initially did last month, when representatives of Elon Musk’s Department of Government Efficiency arrived at its Washington headquarters.
CFPB is responsible for protecting consumers from financial fraud and deceptive practices. It processes consumer complaints and examines banks to protect student loan borrowers.
The National Treasury Employees Union, which represents more than 1,000 workers at the bureau, sued on Feb. 9 to block mass firings. Plaintiffs’ attorneys argue that the administration doesn’t have the constitutional authority to eliminate an agency that Congress created by statute.
“The defendants’ unlawful action will have immediate consequences for the Americans that the CFPB was designed by Congress to protect,” the lawyers wrote.
Government lawyers have said the plaintiffs are seeking to impermissibly place the CFPB in a “judicially managed receivership,” with the court overseeing its day-to-day operations.
Jackson started her 112-page ruling by quoting Trump and his allies’ own words about the bureau. Trump’s billionaire adviser, Elon Musk, posted “CFPB RIP” on X, his social media platform, and added an emoji of a tombstone. White House budget director Russell Vought said it has been “a woke and weaponized agency against disfavored industries and individuals for a long time.” Trump called it “a very important thing to get rid of.”
“In sum, the Court cannot look away or the CFPB will be dissolved and dismantled completely in approximately thirty days, well before this lawsuit has come to its conclusion,” Jackson wrote.
Among the plaintiffs was 83-year-old Eva Steege, a Lutheran pastor in hospice care who had been working with CFPB to resolve her student loan debt before her death. The agency found she qualified for loan forgiveness and a $15,000 refund of overpayments, but the stop-work order went into effect before she could have a follow-up meeting and the official she was working with was fired.
“Steege’s fear of leaving her surviving family members saddled with her student loan debt came to pass on March 15, when she died,” the judge wrote.
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