Biden Employs Aggressive Strategy to Sideline Top Career Officials at Consumer Protection Bureau

The Biden administration is taking unusual steps to ensure it can install its own hires into top career positions at the Consumer Financial Protection Bureau and push out officials who served under President Trump, according to several current and former employees. 

CFPB in recent months has offered separation incentives including early retirement and launched investigations into career senior executives to sideline them, targeting about a half-dozen of the highest-ranked non-political staffers at the bureau. The approach is an atypical one given the intentional role of career employees to remain in their jobs from one administration to the next and the laws established to protect them from politically motivated personnel decisions. Critics also say the tactics are hypocritical after Biden came into office promising to empower the federal workforce and refrain from interfering with career employees' work. 

Several top career slots at CFPB have already become vacant, some after executives were pushed out with incentives like early retirement that allowed them to access their full pension and other benefits before they would otherwise have been eligible. At least one top executive is indefinitely on paid administrative leave after the bureau launched an investigation into the executive's hiring actions. Multiple individuals with knowledge of the events described the probe as frivolous and intended only to push the employee aside. The impacted employees are mostly in the position of associate director and members of the Senior Executive Service, the top ranking level for career federal workers. 

“It was very clear that there was no respect for senior executives that worked at the agency,” one current career worker still at the agency said of the Biden team after it arrived at the bureau. “The way they’re treating career executives is terrible.” 

One former executive who left CFPB since Biden’s inauguration said it was apparent the new administration was making a concerted effort to oust those who had served under the Trump administration. 

“It’s accurate to say there has been a push to get rid of top career people there,” the long-time federal employee said. “I don’t think it’s a coincidence.” 

Several former and current employees agreed the Biden team had a list of names it was aiming to install into the career slots at the bureau and therefore wanted to create vacancies. Federal statute dating back to the 19th century and updated more recently in 1978 requires personnel decisions be made "without regard to political affiliation." Employees are legally protected against any action made for "partisan political purposes." Biden has nominated Rohit Chopra, a current commissioner on the Federal Trade Commission, to serve as CFPB director. He is awaiting confirmation by the Senate. 

“It’s very clear what’s happening—it’s forcing people out who are not political actors,” said another former employee. “This is being done in a pretty underhanded way and, frankly, they are getting away with it.” 

Provided a detailed list of allegations, a CFPB spokesperson declined to comment directly but did not deny any of them. 

“CFPB’s career staff are among the most dedicated and talented anywhere in government,” the spokesperson said. “CFPB values the contributions of our career staff and respects the critical workplace protections afforded to career federal employees. We have every confidence in the ability of our career staff to carry out the vital work of CFPB.”

The bureau already has a complicated history with career staff in its relatively brief existence. Many of its initial hires while standing up the agency after the passage of the 2010 Dodd–Frank Wall Street Reform and Consumer Protection Act were brought on using excepted service hiring authority, meaning it avoided some of the normal hurdles in federal hiring. This created a distrust between the career executive staff and Mick Mulvaney, who led CFPB in a temporary capacity under Trump. Mulvaney took the controversial step of installing new political appointees at the bureau to whom top career staff would answer, sparking outcry from consumer advocacy groups and lawmakers like Sen. Elizabeth Warren, D-Mass. 

“Mulvaney decided he couldn’t get anything done if he was working directly with the [Obama-era] people,” said Tom Pahl, a third former CFPB employee who served as the bureau’s politically appointed deputy director before Biden took office. 

Several of the original executive-level CFPB staffers stepped down in that era, leaving Mulvaney and Kathy Kraninger, his successor, to fill the slots. That context “created conditions” in which Biden’s team may have wanted to once again prompt turnover to more directly affect policy decisions, Pahl said.  

“The transparent way of doing that would be to add politicals,” he said, “but if you don’t want to do that, it does create an incentive to find some space for them.” 

Former Rep. Barney Frank, D-Mass., who lent his name to the law that created CFPB, similarly suggested the Biden administration might have motives to clean house at the bureau. 

“It’s an unusual agency in that Trump was entirely hostile to its mission and its purpose,” Frank said, adding he would “not be surprised if the new administration felt it needed to make changes” given that history.

Pahl conceded CFPB in the Mulvaney and Kraninger eras would ask candidates for top civil service jobs delicately worded questions (so as to not run afoul of statutes that prohibit political considerations in federal hiring) to ensure they would not openly rebel against Trump administration priorities, but maintained he and his colleagues were equally careful not to “leave behind people who were obstructionists” to Biden’s agenda.

At least some of the employees impacted by the current Biden personnel moves were not sympathetic to Trump and his vision for a far less aggressive CFPB, leaving them to wonder why the new administration pursued its approach in the first place. 

“I was a career civil servant and worked for many years through many administrations, but I found the Trump administration just really hard to deal with,” said one former executive, adding that working in that atmosphere was “just so hard and demoralizing.”  

Federal employees at many agencies throughout government have expressed similar sentiments over the last several years, suggesting Trump officials took unprecedented steps to foist themselves into agency work. Biden repeatedly promised to reverse that practice, vowing to listen to federal employees and give them unrestricted independence in conducting their duties. Shortly after taking office, Biden moved to unwind Trump executive orders aimed at weakening federal employee unions and civil service laws. 

“You’re the ones running the show,” Biden said in a video message recorded for federal employees during his first week in office. 

The current CFPB employee said the administration’s actions at the bureau have not lived up to that mantra.

“I voted for Biden and I’m getting ousted because I was hired by the previous people,” the employee said. “It's not my fault.”

That employee does not plan to stick around too much longer at CFPB, regardless of how the bureau’s personnel efforts ultimately play out.  “I don’t want to work for people who don’t want me,” the staffer said. 

Another former employee called recent events “really sad,” noting they could have profound impacts on the affected individuals. 

“It’s ruining the careers of really quality people who came from decades at other agencies,” the employee said.

The situation could soon draw the attention of Congress. 

“It would be very concerning if the administration were to politicize the CFPB by removing senior career employees and replacing them with handpicked activists as alleged,” said Amanda Thompson, spokesperson for Republicans on the Senate Banking Committee, while encouraging anyone impacted to reach out to the panel to confidentially share their stories. 

Those connected to the CFPB world also raised concerns about the loss of institutional knowledge, especially at a young agency still looking to find its permanent footing in the larger federal and regulatory landscape. 

“There is a risk if people are leaving who have extensive experience, especially at a place like the bureau,” said one of the former employees. “If you lose those people, I do think that's unfortunate.” They implored the Biden administration to give their former colleagues a chance: “With career civil servants, I think they deserve the benefit of the doubt.”