Workers of the Consumer Financial Protection Office received the order to paralyze almost all their work by officials of the administration of President Donald Trump, who also indicated the closure of the office in Washington for a week.
The administration of President Donald Trump ordered the consumer financial protection office to stop almost all his work, virtually closing the agency, created to protect consumers after the financial crisis of 2008.
Russell Vought, the newly appointed director of the Office of Administration and Budget, ordered the CFPB, in an email from Saturday night confirmed by The Associated Press, That work on the proposed standards, suspend the entry dates of any rule that was completed but will not yet come into force, and stop the research work and not begin any new research.
The email also ordered the office to “cease all supervision and exam activity.”
On Sunday, government officials also said that the headquarters of the CFPB in Washington, DC would be closed the week of February 10 to 14, according to an email obtained by The Associated Press. No reason for closing was given.
“Employees and contractors must work remotely unless they are indicated otherwise,” email told the headquarters of the headquarters.
The Order continues to efforts of the White House to close the United States Agency for International Development.
Since the CFPB is a creation of the Congress, a separate law would be required from Congress to formally eliminate it. But the agency director has discretion about what compliance measures take, if any.
However, Elon Musk commented: “CFPB RIP” at the social media site X on Friday. And the CFPB home page on the Internet was inactive on Monday, replaced by a message that said “page not found.”
Also on Saturday night, Vought said in a publication on social networks that the CFPB would not withdraw its next financing round of the Federal Reserve, and added that its current reservations of 711.6 million dollars are “excessive.” The Congress ordered the office to be financed by the Federal Reserve to isolate it from political pressures.
“This tap, which for a long time contributed to the lack of responsibility of the CFPB, is now closing,” Vought said in X.
The CFPB says that it has obtained almost 20,000 million dollars in financial relief for US consumers since its foundation in the form of canceled debts, compensation and reduced loans.
Last month, the office demanded Capital One for allegedly deceiving consumers about their offers of high interest savings and “cheating” customers with more than 2,000 million dollars in lost interest payments as a result, said the office.
Dennis Kelleher, president of Better Markets, a defense group, said the office “is an effective police in the financial field and has been next to hundreds of millions of Americans – republicans and democrats – in their fight against financial predators, scammers and criminals. ”
The measure of the administration against the CFPB also highlights the tensions between Trump's promises to reduce costs for working class families and their promise to reduce government regulation.
During the campaign, Trump said it would limit the interest rates of 10 %credit cards, after they firled at record levels above 20 %, on average, when the Federal Reserve increased interest rates in 2022 and 2023. The CFPB had begun to work on how that proposal would be implemented.
The office can still receive complaints, but cannot carry out exams or continue with existing investigations, according to a person familiar with the agency who insisted on anonymity to discuss CFPB issues. The memorandum is also interpreted as a blockade to communicate with the companies that regulate, consumer defenders or other external groups.
The Musk team would also have access to complaints, research and regulatory supervision data.
Vought's email follows a similar directive by the Treasury Secretary, Scott Besent, on February 3 and is the last measure of the Trump administration to quickly reduce the work of federal agencies that have considered excessive.
The former president Barack Obama headed the creation of the office following the real estate bubble and the financial crisis of 2007-2008, which was caused in part by fraudulent mortgage loans. It was an idea of Massachusetts Democratic Senator, Elizabeth Warren, and has attracted demands of large banks and commercial associations of the financial industry.
“Vought is giving the great giant banks and corporations green light to cheat families,” Warren said.
Last week, Warren asked Trump to work with the office to protect Americans from the overcrowding, the practice of banks to close customer accounts because they believe they propose financial, legal or reputation risks for banks.
Vought's email said President Donald Trump had appointed him interim CFPB director on Friday. Trump fired the previous director of the office, Rohit Chopra, on February 1.
Bajo Chopra, the CFPB approved rules to limit rates due to overflows, limit junk rates and have proposed restrictions on data corridors that sell personal information, such as social security numbers.