CFPB Firings On Hold Amid Lawsuit Against Trump Layoffs

The Consumer Financial Protection Bureau’s (CFPB) acting director has reportedly agreed to pause a mass firing of agency employees.

As ABC News reported Friday (Feb. 14), attorneys for Russell Vought, acting director of the CFPB, reached an agreement during a court conference to postpone the firings amid a lawsuit challenging the regulator’s dismantling.

The agreement bars the CFPB from firing employees for reasons not related to their work performance or conduct, and also blocks the Trump administration from trying to shift funding away from the consumer protection agency.

According to the report U.S. District Judge Amy Berman Jackson said she will consider issuing a longer-term preliminary injunction at a hearing on March 3. Her ruling came after the CFPB cut its probationary workers as part of the Trump administration’s wide-ranging layoffs.

Unions representing the employees and suing the administration alleged in a court filing that Vought planned to fire more than 95% of CFPB staff. They argued that cuts of this size — or the end of the CFPB altogether — could have drastic consequences for American consumers.

Under the court ruling, the White House is also barred from destroying or altering sensitive records kept by the CFPB.

This came after former CFPB Chief Technologist Erie Meyer alleged in a legal filing that administration officials were preparing to delete databases holding the agency’s data, such as compliance and enforcement records.

“Reports that I have received from within the Bureau reliably indicate that databases holding the CFPB’s data will soon be deleted,” Meyer said in the filing. “If that happens, it would result in the immediate and irrevocable loss of data essential to the agency’s core mission.”

Vought last weekend froze all of the CFPB’s supervisory and examination activities, while also shutting down the bureau’s office and ordering workers to stay home. He’s also pledged to halt the agencys funding, saying he had told the Federal Reserve that the CFPB would not take its next draw of appropriated funding because it wasn’t necessary to fulfill its duties.

The suspension of work by the CFPB left the financial services industry wondering what to do next, PYMNTS wrote last week.

“If nobody’s home, you have financial services entities just trying to make their best guess,” former Obama administration assistant treasury secretary Amias Gerety said Monday as part of his weekly discussion with PYMNTS CEO Karen Webster.