The legal wranglings over the future of the Consumer Financial Protection Bureau continue to work their way through the justice system. Both sides can claim a recent victory — in one case a judge has denied an request for a preliminary injunction blocking the Bureau’s attempt to give back money it has received from the Federal Reserve, while another judge has ordered the CFPB and other agencies to rehired probationary employees who were fired.
Baltimore’s Lawsuit Against the CFPB
District Court Judge Matthew J. Maddox has rejected the city of Baltimore’s request for a preliminary injunction that sought to block the Trump administration’s attempt to send the CFPB’s reserve funds back to the Federal Reserve or the Treasury Department. Baltimore, supported by Economic Action Maryland Fund, argued that the CFPB’s financial operations were being undermined, which could hurt consumer protection efforts in the city. However, Judge Maddox found that there was insufficient evidence to prove that a final decision had been made by the CFPB to transfer its funds, and therefore the court could not intervene at this stage.
CFPB Forced to Rehire Employees
The CFPB, along with other 18 federal agencies, have been ordered by a federal judge to rehire probationary employees they had recently fired. This decision came after a lawsuit claimed that the terminations violated federal regulations requiring performance-based assessments and prior notice. The judge’s ruling found that the terminations were unlawful because they did not comply with these requirements, and as a result, the agencies were directed to reinstate the employees and provide back pay. Despite this, many terminated employees will remain on administrative leave until further instructions are given.
The CFPB’s Resilience Amidst Challenges
Despite ongoing efforts by the Trump administration to dismantle it, the CFPB continues to operate, with The New York Times reporting that the agency has refused to die
