Court Ruling Breathes Life Into CFPB

The government’s banking watchdog is set to get back on the job this week after a court order stopped President Donald Trump’s administration from dismantling the Consumer Financial Protection Bureau.

On Friday, Judge Amy Berman Jackson ordered the White House to reinstate fired employees, restore contracts, and give employees of the CFPB office space or remote work access. The ruling was a sweeping rebuke of the actions Trump and his cost-cutting advisor, Elon Musk, took in February to dismantle the agency. In ordering the injunction, Jackson sided with a bureau union and consumer groups who had sued the Trump administration to reverse the actions of acting bureau director Russell Vought.

The legal dispute over the CFPB is one of many courtroom battles currently being waged over the extent to which Trump and his Department of Government Efficiency have the authority to stop spending and government agencies’ work without Congressional approval.

What’s Next for the CFPB?

Jackson’s injunction wasn’t the last word on the CFPB’s fate, but it was meant to preserve the agency and its operations while the legal dispute played out. Bloomberg Law reported that the Trump administration is filing an appeal to overturn the injunction.

“Absent an injunction freezing the status quo—preserving the agency’s data, its operational capacity, and its workforce—there is a substantial risk that the defendants will complete the destruction of the agency completely in violation of law well before the Court can rule on the merits, and it will be impossible to rebuild,” Jackson wrote in a 112-page opinion.

The CFPB, established after the Great Financial Crisis, is tasked with supervising financial institutions and punishing companies that harm consumers. Since its inception, Republicans have criticized the bureau and called for its elimination, arguing that it imposes onerous rules on banks and financial companies.