In a dramatic shift within the Consumer Financial Protection Bureau (CFPB), the agency’s new acting director, Russell Vought, instructed employees to halt “all supervision and examination activity” as well as “all stakeholder engagement,” effectively bringing operations to a standstill. This directive was sent to staff in an email late Saturday evening, signaling a major disruption in the bureau’s functions.
Vought, who was appointed acting director of the CFPB after his confirmation this week as head of the Office of Management and Budget, reinforced instructions from the previous acting director, Treasury Secretary Scott Bessent. Last week, Bessent ordered that no new rules or guidance should be issued and that all ongoing investigations should be suspended. In his email, Vought reiterated his commitment to enacting the president’s policies in accordance with the law, promising to act as a “faithful steward” of the agency’s resources.
Although Congress created the CFPB in 2011 as a watchdog for the financial sector, it is not at risk of closure without congressional action. However, the director has significant authority to freeze much of the agency’s activity. This can include halting enforcement actions, weakening or repealing existing regulations, and reducing the agency’s oversight of financial institutions.
The CFPB, which has taken bold actions over the years to implement consumer protections in areas like mortgages, credit cards, and loans, has notably sued financial institutions in the past for consumer rights violations. In January, the agency filed a lawsuit against Capital One, accusing the bank of misleading customers about its high-yield savings account, which was later kept at near-zero interest rates.
In his post on X (formerly Twitter) Saturday evening, Vought also revealed that the CFPB would forgo its next draw of unappropriated funding from the Federal Reserve, a move that aligns with his conservative approach to reducing federal agency expenditures. He argued that the current balance of $711.6 million in the CFPB’s budget was “excessive” in the current fiscal environment, and described it as a source of the bureau’s lack of accountability.
Protests erupted outside the CFPB’s Washington, D.C., headquarters on Saturday, as union members, who represent the agency’s employees, demonstrated against the suspension of its activities. Some protesters carried signs mocking Elon Musk, who has been involved in efforts to streamline government agencies. In a related development, Musk’s team reportedly gained access to the CFPB’s systems on Friday. Later, Musk posted a cryptic message on X, declaring “CFPB RIP,” followed by a gravestone emoji. This message coincided with the bureau’s website displaying a “404: Page Not Found” error, further fueling speculation about the agency’s future.
The CFPB did not respond to requests for comment regarding the operational halt by press time.
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