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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.
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. Congress created the bureau after the 2008 financial crisis. 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.
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Associated Press writer Lindsay Whitehurst contributed to this report.
