CFPB official details DOGE ‘chaos’ in overtaking agency

A top official at the Consumer Financial Protection Bureau (CFPB) gave an inside account of the “chaos” and “confusion” that overtook the agency when the Department of Government Efficiency (DOGE) arrived at the consumer watchdog in early February.

Adam Martinez, chief operating officer of the CFPB, took the stand Monday in a lawsuit challenging his agency’s apparent dismantling as a Justice Department witness, testifying to the changes at the agency amid competing accounts from staff and leadership.

The account, which painted a less dire picture of the current state of affairs within the agency, marks the most detailed explanation of DOGE’s efforts to cut back costs within the agency yet after several declarations cast into question the scope of changes.

“DOGE came in with a very hard fist, so to speak,” Martinez said, adding, “When the [Office of Management and Budget] director’s team came in, I felt the adults were around the table at that point.”

Martinez, who has worked in government across five administrations, said DOGE-affiliated employees first arrived at the CFPB on Feb. 6, with agency staff receiving less than an hour heads up.

He testified that DOGE’s work at the agency felt like a formal audit of its operations, leaving him with the impression that they knew “exactly what they wanted to do” and “how they wanted to do it.”

DOGE’s arrival at the consumer watchdog was “very contentious,” Martinez said. A CFPB employee confronted DOGE staffers who were meeting with agency officials, demanding to see their IDs. Four security guards were called down, and the employee ultimately left.

Days later, acting CFPB Director Russell Vought took control of the agency and ordered staff to “stand down” from all work. Dozens of CFPB employees were fired, and the agency's headquarters were closed. The building’s lease was later terminated.

Vought said the newly arrived DOGE employees were acting on his behalf; Martinez testified they were designated as senior leaders within the agency.

The CFPB's chief legal officer, Mark Paoletta, has effectively been acting as the agency’s chief of staff, a role that has remained open in recent weeks, according to Martinez.

The National Treasury Employees Union and other groups quickly sued over the agency’s apparent dismantling, arguing the effort violates the separation of powers between the branches of government.

In the face of concerns that the administration was preparing to conduct mass layoffs, U.S. District Judge Amy Berman Jackson barred officials from firing CFPB employees without cause or issuing a reduction-in-force notice.

Amid an administration-wide push for large-scale layoffs, Martinez testified Monday that the CFPB was initially preparing to cut 1,175 employees out of the agency’s workforce of more than 1,700 employees.

This number was later revised down to between 700 and 900 employees, after the agency fired about 200 employees who were still in their one- to two-year probationary period, as well as some who were hired for a limited period known as term employees.

The CFPB was planning to cut even more employees in a second phase of reductions.

On cross-examination, Martinez confirmed the CFPB planned to terminate the “vast majority” of its employees — himself included.

Jennifer Bennett, a lawyer for the challengers, suggested DOGE sped up its plan to fire hundreds of employees after her clients sought a court order blocking the apparent dismantling of the CFPB as litigation continues.

But Martinez said DOGE’s “desire to unload staff from the agency” was already pressing and, in his view, unaffected by the court’s involvement.

“I think that DOGE would have been equally as happy if we terminated people on Wednesday versus Friday,” he said.

Martinez said that, even under Rohit Chopra, former President Biden’s director of the CFPB, staff were directed to “pinch pennies” as the agency came close to hitting the top of its budget.

When DOGE took over, it sought to cut scores of contracts. But when the acting director and staff “got more engaged” in the organization, they “started to pull back,” Martinez said, noting that some of the contracts targeted were fulfilling statutory requirements.

“It’s like shoot first and ask questions later?” Jackson asked.

“Yes,” Martinez replied, nodding his head.

The Trump administration has maintained that it does not plan to eliminate the CFPB. However, several employees said in court declarations that they were told the administration intended to “wind down” the agency, eliminating all but five employees and transferring its statutorily required duties to other agencies.

Martinez testified that, with DOGE in charge, there was an attempt to wind down the agency. He agreed with plaintiffs’ counsel that such a wind down would not be consistent with legal requirements.

However, since then, some CFPB offices have been authorized to resume their work, after the agency’s chief legal officer emailed employees earlier this month clarifying that they should still be performing statutorily required work, according to a trove of emails filed in court.

“I think there’s less confusion today,” Martinez said. “I have hope for the future. I think that people are, I think people want to go back to work and want to do the work they were hired to do.”

“I don’t want to say normal, but we’re operating,” he later added.

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