From CNBC: 2025-06-12 12:18:00

The Federal Reserve’s inspector general is investigating the Trump administration’s attempt to lay off Consumer Financial Protection Bureau employees and cancel contracts. Key U.S. oversight arms are now examining the actions of acting CFPB head Russell Vought and Elon Musk’s Department of Government Efficiency. Senators Elizabeth Warren and Andy Kim requested the investigation.

The inspector general’s office confirmed the investigation, which includes reviewing workforce reductions and canceled contracts at the CFPB. Additionally, the Government Accountability Office is examining the legality of Vought’s actions and their impact on the agency’s mission. The CFPB’s ability to fulfill its mandate is under scrutiny amidst Trump’s dismantling of public services.

The Federal Reserve’s inspector general serves as an independent watchdog over the Fed and CFPB, with the authority to examine agency records, issue subpoenas, and refer criminal matters to the Department of Justice. Following Trump’s dismissal of over 17 inspectors general, Michael Horowitz was named the incoming watchdog for the Fed and CFPB, praised for uncovering problems with the FBI’s probe into Trump’s 2016 campaign.

The fate of the CFPB now rests on a pending decision from a federal appeals court, which temporarily halted Vought’s efforts to lay off employees. The court is considering the Trump administration’s appeal over its plans for the agency, as scrutiny and oversight continue into the actions taken by the administration.

Read more: Trump CFPB cuts reviewed by Fed inspector general