Layoff halt enforced by judge regarding CFPB's plan to dismiss 1,500 employees
Consumer Financial Protection Bureau (CFPB) Layoffs Resume After Federal Appeals Court Ruling
The Consumer Financial Protection Bureau (CFPB) has resumed its layoffs, following a ruling by the federal appeals court that allowed the agency to proceed with the plan. The ruling overturned a lower court injunction that had temporarily paused the layoffs, affecting over 1,400 employees and reducing the workforce by approximately 90%.
The layoffs, which were announced by the CFPB's acting director, Russ Vought, in memos to nearly 1,500 workers, have been underway since the ruling on August 15, 2025. The staff reduction in the Office of Consumer Response, which primarily handles day-to-day tasks necessary for fulfilling statutory duties, will see a significant decrease, with the office set to shrink from an estimated headcount of 135 to a staff of eight managers.
Judge Amy Berman Jackson of the U.S. District Court for the District of Columbia issued the ruling that allowed the layoffs to resume. However, the National Treasury Employees Union and others challenging the layoffs have been instructed to seek remedies through federal employee and union-specific processes rather than through court injunctions.
The CFPB must continue to carry out its core functions, such as responding to consumer complaints, despite the reductions. The bureau's budget was also recently reduced by law, reflecting its diminished role moving forward.
Notable personnel affected by the layoffs include Matthew Pfaff, chief of staff at the CFPB's Office of Consumer Response, who received a notice that his employment would end on June 16 but would lose access to the CFPB's systems at 6 p.m. on Friday. Elizabeth Bond, a senior adviser to the CFPB's chief technologist, received her termination notice while on maternity leave.
Critics of the staff reductions, such as Erin Witte, the Consumer Federation of America's director of consumer protection, and Senator Elizabeth Warren, D-MA, have expressed concern about the impact of the staff reductions on consumers and the future of the agency. Senator Warren described the CFPB as "gutted."
Senator Warren, along with others, has vowed to fight back against what they perceive as an assault on consumers and democracy by the current administration. Erin Witte argued that the staff reductions do not meet the court's requirement for an "individualized" or "particularized" assessment.
As the layoffs continue, the CFPB's Office of Consumer Response is projected to handle more than five million complaints and over half a million calls in 2025. Despite the challenges, the agency remains committed to fulfilling its statutory duties and protecting consumers.
The resumption of layoffs at the Consumer Financial Protection Bureau (CFPB) is causing concern among critics, who argue that the staff reductions may negatively impact consumers and the future of the agency. Senator Elizabeth Warren, D-MA, has described the CFPB as "gutted" and has vowed to fight back against what she perceives as an assault on consumers and democracy by the current administration.
The ongoing layoffs in the CFPB's business sector, particularly in the Office of Consumer Response, could potentially affect the agency's ability to handle consumer complaints and calls, with projections estimating over five million complaints and half a million calls in 2025. This situation raises questions about the political involvement in finance and general news, and whether such staff reductions align with the agency's statutory duties to protect consumers.
