In court filing, Trump administration says it will keep ‘streamlined’ CFPB running

In a case brought by the National Treasury Employees Union against Vought in his capacity as acting CFPB director, which was filed earlier this month in the U.S. District Court for the District of Columbia, the union alleges that the White House and appointees of the president have taken steps to systematically dismantle and shut down the CFPB.

“In defiance of Congress’s role in our constitutional system and the separation of powers, President Trump has openly declared his intent to ‘totally eliminate’ the CFPB, and the defendants are acting quickly to carry out that direction,” the union said in announcing the lawsuit on Feb. 13.

“Their actions have caused mass confusion and imposed significant and irreparable harm on consumers across the country.”

But in a response filed on Monday, government attorneys cite Vought in saying that a shutdown of the bureau is not the endgame — although a scaling back of its efforts are.

The CFPB’s “new leadership will run a substantially more streamlined and efficient bureau,” the attorneys quote Vought as saying in a letter to the Federal Reserve, which allocates the bureau’s operating budget.

In the filing, the closure of the bureau’s Washington headquarters is attributed not to a shutdown of the agency but to “disruptive protests” lodged by its employees who oppose the administration’s actions to scale down operations and enforcement actions.

“Remarkably, the CFPB employee groups and other Plaintiffs now spin these actions and others as being part of a ‘coordinated campaign by the new administration to eliminate the’ CFPB,” the filing stated.

But since the president nominated Jonathan McKernan as the new CFPB director — and McKernan is slated for a confirmation hearing this week with the Senate Banking Committee — this contradicts a perceived intention to shut down the bureau, government attorneys argue.

“[B]ecause the public has an interest in ensuring that an agency can carry out its statutory duties in line with the policy priorities of the democratically elected administration, the public interest and balance of the equities tip in [the administration’s] favor,” according to the filing.

The CFPB has been a target of Republican lawmakers and conservative advocacy groups for most of its existence, routinely saying that it oversteps its enforcement authority. Elon Musk, who leads the U.S. DOGE Service inside the White House, publicly called for the bureau to be “deleted” shortly after Trump won the election in November.