The Consumer Financial Protection Bureau in the United States has allocated funds to shut down and stop for a week.

If not approved by Congress, the agency cannot be revoked, but the head of the agency can achieve substantive shutdown in many ways, such as stopping enforcement, weakening or revoking regulations, etc.

Article Author: Yue Yue

Article Source: "Caixin"

The Consumer Financial Protection Bureau (CFPB), which has been in operation for nearly 14 years, may face closure. The newly appointed acting director of the bureau, Russell Vought, announced on social media on February 9th local time that the Federal Reserve has been notified to stop funding the CFPB. Bureau staff have been notified to “cease all supervision and inspection activities,” and the Washington headquarters building will be closed from February 10th to 14th. Elon Musk also posted a “CFPB RIP” with a gravestone emoji on social media.

CFPB is responsible for implementing and enforcing the Consumer Financial Protection Act, and ensuring that the consumer financial product market is transparent, fair, and competitive. The agency was established by the Obama administration to address the abuses in the financial industry following the 2008 financial crisis, and began operations on July 21, 2011, regulating financial institutions with assets over 100 billion U.S. dollars.

Unlike most federal agencies that rely on annual appropriations from Congress, the CFPB, as an independent agency under the Federal Reserve, receives its budget directly from the Fed, with a cap tied to the Fed's operational expenses (typically not exceeding 12%). This design was intended to avoid political interference, but Republicans have long questioned its constitutionality and also believe that its oversight is too aggressive and its regulatory scope is too broad. Since President Trump's second term, many business figures have been calling for the elimination of the CFPB.

The move by Watt was to temporarily suspend regular funding programs on the grounds of "excess funds." "The current $7.116 billion balance at the Bureau is actually too much in the current fiscal environment," Watt said on social media. Watt served as the Director of the White House Office of Management and Budget from 2020 to 2021. On November 22, 2024, he was re-nominated by President Trump to be the Director. Watt was sworn in on February 7, 2025, and appointed Acting Director of the CFPB on the same day.

However, without congressional approval, the agency cannot revoke, but the head of the agency can achieve a substantial shutdown by stopping enforcement, weakening or revoking regulations, and other means.

According to foreign media reports, about 100 employees protested outside the Consumer Financial Protection Bureau on February 8th. Prior to this, the government efficiency department (DOGE) led by Musk had entered the bureau and gained access to the internal computer systems managing the bureau's human resources, procurement, and financial systems.

The CFPB union said in a statement that Musk's team's entry into the agency "is clearly an attempt to attack union workers and weaken the only agency that checks the greed of payment suppliers and car loan institutions such as Tesla". Musk is the CEO of Tesla and operates five other companies. The union also said that the agency collects and retains a large amount of sensitive information about individuals and businesses, and is concerned that "this legally protected sensitive data will be leaked and used improperly".

Previously, Musk's 'lean budgeting hand' had targeted the Federal Reserve. He once said on social media that DOGE listed the 'overstaffed' Federal Reserve as the latest budget cut target to pursue government efficiency improvement. He believes that the Federal Reserve is 'excessively staffed, to the point of absurdity'.

Musk and DOGE had previously led the initiative to revoke the US Agency for International Development. On February 7th, a federal judge temporarily halted the dismantling of the US Agency for International Development.