Divided Federal Appeals Court Gives Go Ahead for Mass CFPB Firings

Last week, a divided federal appeals court paved the way for President Trump to resume the mass firings at the Consumer Financial Protection Bureau (CFPB), ruling that the lower court that temporarily blocked the firings did not have the jurisdiction to do so. The 2-1 ruling stated that legal defects in the lawsuits brought on by CFPB employees and the NAACP required the block to be lifted.

“We hold that the district court lacked jurisdiction to consider the claims predicated on loss of employment, which must proceed through the specialized-review scheme,” the majority wrote, according to CNBC. Judge Gregory Katsas authored the ruling, and emphasized that the sweeping directive to close the CFPB was not something the circuit courts could review.

Reuters noted that the circuit court said the decision would not take immediate effect, so that lawyers representing CFPB employees and pro-consumer organizations could seek reconsideration by the full appeals court. Any dismissal notices will likely have to wait; still, the ruling impacts possibly 1,500 Bureau employees who have been fired starting in April.

Attorney General Pam Bondi supported the federal appeals court’s decision, calling it “another win for President Trump” on the social network X. She referred to the effort to dismantle the agency, although the administration has stated in court that they plan to allow the CFPB to continue in its reduced form, namely in its fight against “debanking.”

Circuit Judge Cornelia Pillard, who was appointed by former President Barack Obama, dissented in the ruling, saying the lower court acted properly in blocking the CFPB’s mass firings. “But it is emphatically not within the discretion of the President or his appointees to decide that the country would benefit most if there were no Bureau at all,” she wrote.