Updated Aug. 15 at 1:22 p.m.

The Trump administration can proceed with its dismantling of the Consumer Financial Protection Bureau, a federal appeals court ruled on Friday, allowing the agency to move forward with widespread layoffs expected to impact virtually its entire workforce.

The National Treasury Employees Union and other groups that brought the case must instead pursue remedies through avenues specific to federal employees and their unions, the majority on the U.S. Court of Appeals for District of Columbia said in a 2-1 opinion, adding the actions were not yet finalized and therefore not reviewable by the court. The decision overturns a previous injunction by a lower court, which has prevented CFPB from issuing mass reductions in force since February.

The appellate court had in April partially blocked the lower court’s injunction and CFPB prepared to lay off 90% of agency staff, or 1,482 employees. The higher court subsequently said it did not want to police how many employees were necessary to carry out the bureau’s statutory duties, so it temporarily blocked the RIFs from taking place.

While CFPB staff have remained on the payroll, they have ceased conducting most investigations and their casework has been significantly diminished. The bureau is funded as a percentage of the Federal Reserve’s operating expenses and the recently signed into law One Big Beautiful Bill Act lowered the cap for CFPB from 12% of those expenses to 6.5%. CFPB’s budget was $823 million in fiscal 2025.

The plaintiffs are likely to request an en banc review before the entire D.C. circuit, which could delay the timing of CFPB’s RIFs.

“We are pleased that the DC Circuit Court affirmed the president’s constitutional authority to shrink this weaponized federal agency and slash the regulations they’ve used to smother the American people,” a CFPB spokesperson said. “We look forward to more victories in court on behalf of the president’s agenda.”

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