Judge Extends Order Barring Vought from Depleting CFPB Funds

A federal judge extended a temporary restraining order blocking the Consumer Financial Protection Bureau from sending money back to the Federal Reserve or Treasury Department after plaintiffs submitted declarations showing the agency was looking to do so.

Judge Matthew J. Maddox of the US District Court for the District of Maryland on Friday ordered the CFPB to file a reply to supplemental declarations Baltimore’s mayor and city council and their co-plaintiffs filed without seeking leave to do so.

The temporary restraining order will remain in place until March 14 at 9 a.m., Maddox said.

A Feb. 11 email from CFPB Chief Operating Officer Adam Martinez said the agency had reached out to the Fed to see how it could return money, according to a declaration the Baltimore plaintiffs submitted Friday from Blake Doe, a federal employee using a pseudonym due to fears of retaliation. The CFPB is funded through Fed transfers instead of congressional appropriations.

Doe said he saw the email himself. The declaration was also filed Thursday in a separate case brought by the National Treasury Employees Union, which represents most CFPB staff, and other plaintiffs.

Vought and the CFPB have so far denied that they plan to send the CFPB’s reserves to the Fed or Treasury Department.

Vought announced Feb. 8 that he planned to request $0 from the Fed in the CFPB’s next funding draw, raising concerns he would seek to return existing money.

The Baltimore plaintiffs say they rely on CFPB consumer complaint data to protect their citizens and carry out other functions.

The CFPB and counsel for the Baltimore plaintiffs didn’t immediately respond to requests for comment.

Shutdown Moves

The Friday extension comes after a Feb. 26 hearing in which Maddox sharply questioned both sides.

The CFPB argued the plaintiffs in the case couldn’t prove any final decision on the agency’s funding had been made, and that they didn’t have sufficient grounds to challenge a decision under the Administrative Procedure Act.

In one exchange with Justice Department attorneys representing the CFPB, Maddox said it wasn’t necessary for Baltimore and its co-plaintiffs to “wait for the sword of Damocles to fall” before filing suit. All they needed to do was show harm was imminent.

Acting CFPB Director Russell Vought took over the agency Feb. 7.

Almost immediately, he instructed most CFPB employees to stop work and ordered the agency’s Washington headquarters closed. Vought and the CFPB have also canceled more than $100 million in contracts, including for expert witnesses.

The agency has also voluntarily dismissed with prejudice several high-profile enforcement cases, including against fintech SoLo Funds Inc., Capital One Financial Corp., and a unit of Rocket Cos.

Baltimore’s mayor and city council sued Vought and the CFPB on Feb. 12, asking the court to stop the acting director from defunding the agency. The city, joined by Economic Action Maryland Fund, also sought a temporary restraining order while the case is pending.

The CFPB and the Baltimore plaintiffs then agreed to convert the request into a motion for preliminary injunction provided that the CFPB delay steps to defund itself.

The CFPB and plaintiffs in a separate case led by the National Treasury Employees Union made a similar agreement that will remain in place until after the union’s motion for a preliminary injunction is resolved.

A hearing in the NTEU case is scheduled for March 3.

Along with attempting to stop Vought from defunding the CFPB, the union and its co-plaintiffs aim to prevent layoffs that could touch up to 95% of the agency’s workforce and prevent the destruction of data.

Jonathan McKernan, President Donald Trump’s nominee to be the CFPB’s full-time director, told senators at a Thursday confirmation hearing that he intends to run a streamlined agency, but he vowed to continue its work.

Democracy Forward Foundation represents the Baltimore plaintiffs.

The case is Mayor and City Council of Balt. v. CFPB, D. Md., No. 1:25-cv-00458, 2/28/25.