Summary
The Trump administration has scaled back its plans to dismantle the Consumer Financial Protection Bureau, proposing an agency that would be significantly smaller than it was under President Joe Biden but still larger than the version President Donald Trump initially envisioned right after he took office.
The new proposal, outlined in a memo and court documents filed this week, calls for cutting the bureau’s authorized headcount from 1,700 employees before Trump’s second term to roughly 550. The administration’s earlier plan, according to the same court materials, aimed to shrink staffing to around 200.
The plan is opposed by the CFPB’s employee union, which represents bureau workers through the National Treasury Employees Union. The union said it would continue opposing changes to the agency’s staffing levels and would challenge the reductions through the lawsuit now before the courts.
In filings described by the Associated Press, the staffing plan was presented as a response to budgetary shortfalls, and bureau leadership argued the cuts are required for the agency to comply with its statutory obligations. Geoffrey Gradler, the bureau’s deputy director, wrote that it would be “mathematically impossible to comply with the law without a workforce restructuring and reduction,” according to the court documents.
The supervision and enforcement side of the bureau would be hit broadly if implemented. The proposal would eliminate roughly five out of six positions in the bureau’s supervision division, which oversees bank compliance with federal banking and consumer protection laws, and would reduce enforcement staffing by about four-fifths, AP reported.
CFPB operations have already been heavily disrupted during Trump’s second term, according to the Associated Press account. The bureau’s staff were told shortly after Trump was sworn in to stop doing work, while remaining efforts were directed at unwinding work performed under Biden and earlier actions from Trump’s first term, the report said.
The Associated Press also described the agency’s past targeting in the context of the Department of Government Efficiency, including Elon Musk’s post on X calling for the CFPB to be “RIP,” and an earlier attempt to lay off about 90% of staff—roughly 1,500 employees—before a federal judge stepped in.
CFPB union president Cat Farman said the proposal for a reduced workforce is untenable. In comments AP reported from Farman, she said: “Vought’s insistence that CFPB can meet its statutory obligations with only one-third of the staff is laughable, and an insult to the intelligence of the judges. Everyone knows Vought doesn’t want CFPB to exist at all.”
The Trump administration’s new staffing plan is now being challenged in a lawsuit that pits the National Treasury Employees Union against Russell Vought, the budget director and acting director of the CFPB. AP reported that the plan would likely require approval from a federal judge.