MW Judge says she won't let the CFPB get dismantled for now. Why that matters for consumers and student-loan borrowers.

Andrew Keshner

The D.C. district court judge's decision is another rebuke to the Trump administration

A federal judge is ordering the Trump administration to keep the lights on at the Consumer Financial Protection Bureau with an injunction that maintains the regulator's operations and workforce - at least for now.

"The Court cannot look away or the CFPB will be dissolved and dismantled completely in approximately 30 days," Judge Amy Berman Jackson of the U.S. District Court for the District of Columbia said in a Friday decision announcing her preliminary injunction.

For consumers, the ruling means the regulator has to ensure its hotline for consumer complaints and its database stay working, according to court documents and a consumer expert.

Jackson's ruling mandates a raft of rehires, including a top point person designated to help student-loan borrowers. The ruling comes at a time when the Trump administration is also planning to shut down the U.S. Education Department.

It also comes at a time when eyes are consumer health as a whole, as Americans suffer under the pressure of high prices and climbing debts.

"For consumers, this means CFPB employees can get back to doing what they do best, which is fighting fraud," said Erin Witte, director of consumer protection for Consumer Federation of America.

Early into the Trump administration, officials halted work and moved to fire staff at an agency that's long raised the ire of Republicans. According to longstanding gripes from Republicans and the banking industry, the agency has overstepped its authority in implementing its rules and bringing lawsuits.

The Trump administration's hope was the CFPB would become a "room at Treasury, [the] White House or Federal Reserve with five men and a phone in it," according to an affidavit from an unidentified CFPB staffer.

A federal-workers union and consumer advocacy groups sued to stop the effective shutdown.

Jackson's 112-page decision is another judicial rebuke to the Trump administration's plans to quickly carve down the federal government's workforce. Judges have ordered the reinstatement of thousands of probationary employees in two different cases, both of which are under appeal.

The decision itself notes that it doesn't guarantee the CFPB's long-term survival. Jackson said President Donald Trump is free to push for legislation that remakes the agency however he likes.

"It will then be up to Congress to weigh the advantages of any specific proposal aimed at streamlining the agency against the benefits of sustaining the CFPB, which has been fulfilling its mission to return billions of dollars to consumers at no cost to the taxpayers since 2010," the judge wrote.

"Knowing CFPB is safe for now, we look forward to making our case that by attempting to weaken or eliminate the Bureau, the administration is overstepping its authority and violating the separation of powers," said Doreen Greenwald, national president of the National Treasury Employees Union, which was one of the plaintiffs.

"Congress passed the law that created CFPB as an independent watchdog with a mission of protecting Americans from fraud and abuse in the financial-services industry, and the executive branch cannot simply close its doors," Greenwald added.

Under the Trump administration, CFPB lawyers dropped lawsuits against major financial institutions including Capital One $(COF)$, Rocket Homes $(RKT)$, Zelle and major banks.

In the wake of a diminished CFPB, Americans need to be more assertive in asking questions and safeguarding their own finances to protect their wallets, experts told MarketWatch previously.

The White House did not immediately respond to a request for comment.

-Andrew Keshner

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March 28, 2025 18:43 ET (22:43 GMT)

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