A federal judge on Friday blocked the Trump administration from attempting to dismantle the Consumer Financial Protection Bureau, saying the court “can and must act” to save the agency from being shut down.
U.S. District Judge Amy Berman Jackson agreed to issue a preliminary injunction to keep the agency in existence until she rules on the merits of a lawsuit seeking to preserve it.
The federal government can now ask a federal appeals court for emergency relief.
Lawyers representing a workers’ union and other consumer advocates had sued the Trump administration to reverse the move last month to shutter the agency. The shutdown led to mass firings, contract terminations, office closures and an agency-wide work stoppage.
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The agency had been “within hours of firing nearly its entire staff,” Deepak Gupta, an attorney representing CFPB workers, said in a statement. “We’re heartened by the decision and look forward to continuing to press our case in court.”
President Donald Trump said after firing the CFPB’s director last month that the agency should be shut down. His senior advisor, Elon Musk, who leads the Department of Government Efficiency (DOGE), posted “CFPB RIP” on X on the day DOGE workers gained access to the CFPB’s headquarters.
But after the lawsuit was filed, agency officials backtracked from some of their positions, claiming in court that they did not plan to eliminate the agency and instructed staff to resume some work.
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“If the defendants are not enjoined, they will eliminate the agency before the court has the opportunity to decide whether the law permits them to do it, and as the defendants’ own witness warned, the harm will be irreparable,” Berman Jackson wrote.
She rejected key evidence Justice Department lawyers had presented, calling some claims “a charade for the court’s benefit.”
The judge wrote that Mark Paoletta, the CFPB’s top legal officer, “insults the reader’s intelligence when he feigns surprise” that few CFPB employees were still working.
Berman Jackson also said that the agency’s chief operating officer, Adam Martinez, after being contradicted by sworn statements undermining the administration’s position, had appeared on the witness stand torn between the “loyalties to his new employers and the truth playing out on his face.”
Berman Jackson ordered the CFPB not to delete any data, to reinstate terminated workers and to allow work to resume.
Reuters contributed to this report.
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