A federal judge seems likely to temporarily block the Trump administration from dismantling a major consumer protection agency, fearing a delay could leave nothing for the court to save.
This week, DC District Court Judge Amy Berman Jackson sat through what she called an “illuminating two days” of witness testimony on the future of the Consumer Financial Protection Bureau (CFPB), including plans for a mass reduction-in-force (RIF) of nearly 1,200 employees. The testimony came from a top agency executive and two additional CFPB employees, representing opposing viewpoints. The government tried to demonstrate that early chaos at the bureau had settled into tentative stability — but Jackson was clearly dubious. “A lot of evidence has been introduced that supports a decision that the same people who were sitting in a room and talking about RIFing are still sitting in a room and talking about RIFing,” she said.
Jackson has asked the government to extend an agreement to pause future terminations while she deliberates on a longer-term preliminary injunction, which she aims to decide on later this month. That could mean the difference between helping Americans in dire financial straits — or leaving them on their own for far longer than usual
Jackson cautioned that her thinking was not final. But a preliminary injunction would represent a significant blow to the Trump administration, which has tried to downsize, if not fully dismantle, the financial regulator. Whittling down the agency staff until there’s no one left “might be something that’s allowed to happen, but I don’t think it’s allowed to happen in the way it’s happening,” Jackson says.
The CFPB handles consumer complaints about both traditional financial institutions and other companies offering financial products, like the digital payments service Elon Musk’s X plans to offer. CFPB witnesses told the court that workers for the Department of Government Efficiency (DOGE) — the office that Musk has made himself the public face of — were intimately involved in plans to rapidly cut the agency’s staff, leaving major questions about whether the agency could carry out its statutorily required duties.
A key allegation in the case — brought by the National Treasury Employees Union (NTEU) and groups that rely on the CFPB’s work — is that CFPB acting director Russell Vought is violating constitutional separation of powers by trying to dismantle an agency created by Congress and keep it from doing work mandated by statute. Justice Department attorneys have defended the Trump administration’s actions, saying that it never meant to prevent work explicitly required by the law and that work could be preserved even if it’s under the umbrella of a different agency. But this hearing’s testimony left the impression that’s either a misrepresentation or an outright lie.
‘We were legitimately shutting down’
While March 10th saw several hours of testimony from CFPB chief operating officer Adam Martinez, the next day Jackson heard from witnesses who told a more harrowing version of Vought’s mid-February stop-work directive and DOGE’s push to eliminate the vast majority of staff within 30 days. Those witnesses included a direct report of Martinez’s, using the pseudonym Alex Doe due to fear of retaliation.
Doe alleges they were put in charge of the team organizing mass firings and described several meetings between the RIF team and the Office of Personnel Management (OPM), which advised on how to terminate roughly 1,200 of the agency’s 1,700-person workforce in short order.
In a February 13th meeting Doe attended alongside Martinez, two DOGE staffers who had been detailed to the CFPB participated, Doe testified. One of those staffers, Jeremy Lewin, appeared on and off of the Teams meeting screen because he said he was consulting with Vought, according to Doe. The DOGE staffers and Vought pushed for RIF notices to be sent the next day, Doe testified, with no explanation for the haste.
“Seeing in black and white the number of people that were being fired, it was shocking and it was upsetting”
At a meeting the following day between OPM and the CFPB RIF team, Martinez pulled a memo identifying divisions of the agency that would be effectively wiped out under the plan. Doe said they were advised by OPM that in order to pull off the RIF as quickly as possible, there couldn’t be a single job left in any particular unit, because otherwise, terminated employees would get the chance to compete for the position. “Seeing in black and white the number of people that were being fired, it was shocking and it was upsetting,” Doe testified.
When Doe learned of a hearing in this case on February 14th, while their team was working rapidly to meet the Trump administration’s self-imposed deadline for the RIF notices, they flagged the development to Martinez, expecting the work to be paused to see what the court had to say about it first. “The opposite occurred,” Doe testified. Martinez’s senior advisor told Doe to work faster.
After the government agreed in court to temporarily pause terminations, Doe said one of Martinez’s advisors said to keep working, because they hadn’t yet heard back from the agency’s top legal officer and DOGE was pushing for a time that the RIF notices could be sent. Doe told another advisor that they hoped that if Martinez was going to tell his staff to violate a court order, he had the instruction in writing from DOGE. Then, Doe logged off.
Even after the agency told Jackson it would pause terminations, Doe testified that planning for the CFPB’s closure has continued. At a February 20th meeting, Martinez told staff, “We were legitimately shutting down” and “We would be wiped out in 30 days,” according to Doe. Martinez said at a February 27th meeting with OPM and the CFPB RIF team that he’d let them know if the RIF plan changed, Doe testified. “To this day, [that] has never happened,” they said.
Does stop work mean stop work?
Despite the allegedly ongoing effort to wind down the agency, Martinez testified on March 11th that the Trump administration seemingly didn’t expect employees to take Vought’s stop-work directive at face value. He claimed that Vought’s deputy — Mark Paoletta, the chief legal officer — “genuinely seemed surprised” when Martinez informed him that CFPB staff quite literally stopped working after Vought’s stop-work order was issued.
In a March 2nd email, Paoletta told CFPB staff that it had come to his attention “that some employees have not been performing statutorily required work.” He clarified that “employees should be performing work that is required by law and do not need to seek prior approval to do so.”
Jackson seemed deeply skeptical that Vought telling staff to “stand down from performing any work task” didn’t mean stopping all work. At one point, the Justice Department’s Brad Rosenberg referred to the February 10th email as something that “plaintiffs characterized as a stop work order.”
“It is a stop work order,” Jackson said bluntly. “The way you want to read it is not true to the language here.”
“My concern was some of what we were directed to do by DOGE was essentially irreparable from an operational perspective.”
Martinez claimed some of this messaging was typical of a presidential transition, though the judge also got him to acknowledge that much of it was not. The first week that DOGE came in was “frightening” and unlike anything he’d seen before in government, he conceded on Tuesday. “It just simply was not normal, and the rapidness with which it was occurring was overwhelming.” The experience made Martinez realize “how much damage can be done just within a couple days to an organization. And my concern was some of what we were directed to do by DOGE was essentially irreparable from an operational perspective.”
Martinez testified that “a lot has changed” since Vought and Paoletta — whose main posts are at the Office of Management and Budget (OMB) — became involved at the CFPB. Still, Martinez said, “I have absolutely no clue what the end result is for the bureau,” which essentially means whether and how it will continue to exist.
A third witness, chief of staff for the CFPB’s Office of Consumer Response Matthew Pfaff, testified that work was clearly not getting done, and the chaos has already left a backlog of consumer complaints, company support tickets, and other work that will take “weeks if not months” to work through.
Alongside other chaos like canceled contracts, Pfaff said, no one in his division was monitoring or investigating consumer complaints after the stop-work order was issued. The damage for ordinary citizens was tangible. Pfaff testified that the agency had a backlog of over 16,000 consumer complaints about scams and other financial harms, which will now face delayed responses. At least 75 complaints, he said, could be devastatingly high stakes — they came from people facing imminent foreclosure, but after Vought’s directive, they “had not been touched.”
A temporary injunction may not restore the agency to where it was prior to DOGE’s arrival. But until Jackson is able to rule on the case’s merits, she says, it could mean it’s able to “limp along.”
