Some employees of the Consumer Financial Protection Bureau were fired in the wake of a court ruling that cleared the way for layoffs. Here, CFPB union members and supporters rally outside CFPB’s headquarters last month in Washington, D.C.
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Alex Wong/Getty Images/Getty Images North America
Employees at the Consumer Financial Protection Bureau have begun receiving layoff notices, the latest attempt by the Trump Administration to shrink the bureau and reduce the scope of its work.
“This RIF action is necessary to restructure the Bureau’s operations to better reflect the agency’s priorities and mission,” read one of the notices seen by NPR, referring to reduction-in-force actions.
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Laurel Wamsley is covering what’s happening at CFPB. If you have a tip, you can contact her securely on Signal at laurel.96.
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Staff members began receiving the reduction-in-force notices on Thursday afternoon. It was not immediately clear how many of the agency’s employees were receiving the notices.
The reduction in force notices come after a recent court ruling by a federal appeals panel cleared the way for the layoffs. The three-judge panel said the bureau’s leaders can send a reduction in force notice to employees they have determined to be unnecessary to carry out CFPB’s statutory duties.
The panel otherwise left intact a separate federal judge’s injunction that prevents the agency from being dismantled — including that its data cannot be deleted or destroyed, and that employees must be given workspace or the tools to work remotely.
The CFPB did not respond to NPR’s questions about whether the layoffs had begun.
New direction for the CFPB
The layoffs come after the agency’s chief legal counsel sent a memo to CFPB employees on Wednesday evening that sets a new direction for the bureau.
In the memo, which was viewed by NPR, chief legal officer Mark Paoletta said that the Bureau would lean on states to carry out more enforcement and supervision activities, arguing that doing so would allow the agency to “to focus on tangible harms to consumers.”
Paoletta also said the bureau would shift its focus back to banks and depository institutions such as credit unions and commercial banks.
He added the bureau would “deprioritize” a number of areas it has regulated in recent years, including medical debt, peer-to-peer platforms, and digital payments.
The last item is notable as Elon Musk, who has tweeted “CFPB RIP”, is building a digital payments platform –- a platform that would ostensibly be under CFPB’s oversight. In February, Musk’s Department of Government Efficiency (DOGE) team entered the bureau’s Washington headquarters and took control of key systems.
The CFPB, which was founded in the wake of the 2008 financial crisis, has become a target of the Trump administration as well as some in Silicon Valley and on Wall Street, who say it overreaches in its regulation.
Consumer organizations criticized the bureau’s reorientation as described in Paoletta’s memo, saying it marked a significant retrenchment in its mission.
“The CFPB cannot simply shirk the consumer protection responsibilities Congress gave it and expect states to enforce federal law,” said Lauren Saunders, associate director of the National Consumer Law Center.
This story originally appeared on NPR
