Senate Democrats: Musk’s CFPB Dealings Present Ethical Conflict

A pair of Senate Democrats say they want to kick DOGE out of the Consumer Financial Protection Bureau (CFPB).

The reasoning, as Bloomberg News reported Wednesday (Feb. 19), is that DOGE (the Department of Government Efficiency) staffers have ties to Elon Musk, whose still-in-the-works payments business would be regulated by the CFPB.

Senators Elizabeth Warren (D-Mass.) and Adam Schiff (D-Calif.) said Musk is “not only neutralizing the pro-consumer agency that will supervise X’s digital wallet — he is also potentially gaining access to confidential corporate data that could provide X with an unfair advantage over its competitors.”

Earlier this month, DOGE staffers essentially shut down the CFPB, closing its offices and essentially halting its enforcement activity, at least temporarily. The bureau also fired a number of staffers, though those layoffs were paused amid litigation against a broader round of job cuts by the Trump administration.

“Americans deserve a CFPB that will continue to stand up against corporate greed — not an agency shut down by officials looking out for themselves,” the senators wrote in the letter to CFPB acting director Russell Vought and Treasury Secretary Scott Bessent and seen by Bloomberg.

As the report notes, X — the Musk-owned social media platform formerly known as Twitter — is in the process of launching a person-to-person payments system.

The project has gotten money transmitter licenses in 41 states, with X last month announcing a partnership with Visa to help users send money to digital wallets.

The CFPB last year finalized a rule giving the agency oversight over digital wallets and payment apps that handled more than 50 million transactions per year in U.S. dollars. The bureau had argued this measure would give users of major digital payment platforms the same protections against fraud, privacy violations and account closures enjoyed by banking customers.

Former CFPB Director Rohit Chopra justified the initiative by spotlighting the increasing reliance on digital payments, stating that such transactions have evolved “from novelty to necessity,” requiring updated regulatory oversight.

Last month, a pair of major tech trade associations, NetChoice and TechNet, sued to block the rule, alleging that the CFPB had shown any significant consumer risks or gaps in regulatory oversight to justify the measure. The plaintiffs’ complaint characterizes the CFPB’s approach as “a problem in search of a solution.”