• The Trump administration has ordered the Consumer Financial Protection Bureau (CFPB) to suspend nearly all activities.
• The demand came in the form of an email from newly appointed Director of the Office of Management and Budget (OMB) Russell Vought.
• The CFPB was launched in 2011 as part of a sweeping set of reforms enacted in the wake of the Great Financial Crisis of 2007-2008.

The Trump administration has ordered the Consumer Financial Protection Bureau (CFPB) to immediately suspend nearly all activities, according to a report from the Associated Press. The demand comes one week after President Trump removed the director of the CFPB, Rohit Chopra. The bureau, founded in the summer of 2011 via Title X of the Dodd-Frank Wall Street Reform and Consumer Financial Protection Act, has been a target of conservatives for years. Even Elon Musk, the richest man in the world and head of the Trump administration’s Department of Government Efficiency, has weighed in on the CFPB, claiming that the goal of the administration is to fully “delete” the bureau.

This is not the first time the CFPB has been told to stand down since President Trump was inaugurated. Within days of being named acting director of the bureau, Scott Bessent ordered employees to stop all bureau activities, settlement enforcement actions, and involvement in legal cases.

The latest directive to the CFPB came from newly appointed director of the Office of Management and Budget Russell Vought late last week. The order demands that the CFPB cease work on proposed regulations and suspend the effective dates of rules that have been finalized but are not yet fully in force. Vought also ordered the bureau to stop any investigative activity — including new probes — and to end its supervision and examination efforts. The new director has even pursued the bureau’s funding, stating that the CFPB cannot withdraw its next round of funding from the Federal Reserve, which Vought referred to as “excessive.”

Further, the CFPB’s headquarters in Washington will be closed from February 10 through February 14, with workers and contractors expected to “work remotely unless instructed otherwise,” Vought indicated in an email to employees over the weekend.

So, what can the CFPB do, if anything? At this point, the bureau can still hear consumer complaints, even if it is no longer empowered to examine issues or launch investigations. Additionally, Vought’s order has been interpreted as forbidding the CFPB from engaging with companies it regulates, as well as with consumer advocates and similar outside organizations.

The CFPB has sued Capital One as recently as last month, claiming that the company had misled customers about its high-interest savings accounts, resulting in more than $2 billion in lost interest payments. Massachusetts Democratic Senator Elizabeth Warren — who first conceived of the idea of the Consumer Financial Protection Bureau — decried the decision to suspend the CFPB’s activities, saying that Vought was “giving big banks and giant corporations the green light to scam families.” Of late Warren has suggested that there might be common ground between the CFPB’s mission and the concern that many conservatives and Republicans have about the phenomenon of “de-banking” — even if they disagree on which entities are being unfairly “de-banked.”

If Vought’s name sounds familiar, then it may have to do with his connection to Project 2025, a policy blueprint that was touted by many conservatives and Trump supporters during the presidential election in 2024, but was never fully embraced by Trump as part of the campaign. Many observers see the current moves in Washington to reduce headcount, control spending, and realign various agencies as part of the mission of Project 2025.

Interestingly, there remains some uncertainty about who will take over the CFPB on a permanent basis if the bureau does survive — as most observers view likely. At least two senior CFPB officials have announced their resignations in the wake of Vought’s email: Lorelai Salas, supervision director, and Eric Halperin, enforcement director. The Dodd-Frank Update reported that there are indications that the Trump administration has struggled to find someone interested in the job. In the first Trump administration, the CFPB was run by Mick Mulvaney, who served as acting director from November 2017 to December 2018, and Kathleen Kraninger, who took over from Mulvaney and served until Joe Biden assumed the Presidency in January 2021.

For more thoughts on how the Trump administration is likely to deal with the financial services sector, check out our January column, Will 2025 Be the Year of the Regulator or “Liberation Day” for Financial Services in the US?

Photo by Mathias Reding