Finance

The Consumer Financial Protection Bureau’s Trump-appointed leadership plans to fire nearly all its 1,700 employees while “winding down” the agency, according to testimony from employees.
In a trove of statements released late Thursday, federal employees said that the mass layoff was discussed in meetings they attended this month with senior CFPB leaders and members of Elon Musk’s so-called Department of Government Efficiency.
The filings were made in the case started by CFPB’s union that suspended acting CFPB Director Russell Vought’s moves to shutter the bureau.

Elon Musk holds up a chainsaw onstage during the Conservative Political Action Conference (CPAC) in National Harbor, Maryland, U.S., February 20, 2025. 
Nathan Howard | Reuters

The Consumer Financial Protection Bureau’s Trump-appointed leadership plans to fire nearly all its 1,700 employees while “winding down” the agency, according to testimony from employees.
In a trove of statements released late Thursday, federal employees said that the mass layoff was discussed in meetings they attended this month with senior CFPB leaders and members of Elon Musk’s so-called Department of Government Efficiency.

“My team was directed to assist with terminating the vast majority of CFPB employees as quickly as possible,” said an employee identified as Alex Doe, a pseudonym used out of fear of retaliation.
Doe said the plan from CFPB leaders and DOGE was to cut the bureau’s workforce in three phases. It would first eliminate probationary and term employees, then carry out a wave of about 1,200 layoffs, leaving a skeleton crew of a few hundred workers.
“Finally, the Bureau would ‘reduce altogether’ within 60-90 days by terminating most of its remaining staff,” Doe said.
The workers’ testimony comes at a crucial time for the CFPB, the agency created to protect consumers after the 2008 financial crisis caused by irresponsible lending. Since DOGE operatives first arrived at the CFPB this month, the bureau has shuttered its Washington headquarters, initiated the first round of layoffs and told those who remain to stop nearly all work.
The department has also reversed course on several cases where it accused financial firms including Capital One of ripping off customers, dismissing at least four cases Thursday involving billions of dollars in alleged consumer harm.

The filings containing the employee statements were made in the case started by a CFPB union, which led to a judge suspending acting Director Russell Vought’s moves to shutter the bureau. After the CFPB fired about 200 probationary and term employees, the agency’s actions were put on hold until a March 3 hearing.

‘Five men and a phone’

The documents show an apparent disconnect between some of the external messaging from Vought and the behind-the-scenes activity at the bureau.
In a motion filed Monday in the case, Vought pushed back against the idea that he planned to eliminate the CFPB.
“The predicate to running a ‘more streamlined and efficient bureau’ is that there will continue to be a CFPB,” he wrote.
But the Trump administration’s plan was to take the CFPB down to the barest minimum staffing required under law: Just five CFPB employees would remain, either in a stand-alone office or folded into another regulatory body, the workers testified.
In meetings between Feb. 18 and Feb. 25, “staff were told by Senior Executives that the CFPB would be eliminated except for the five statutorily mandated positions,” said another current CFPB employee, this one identified as Drew Doe.
“One Senior Executive said that CFPB will become a ‘room at Treasury, White House, or Federal Reserve with five men and a phone in it,'” Doe said.
Another CFPB employee said that he or she attended a Feb. 13 meeting in which the bureau’s chief operating officer, Adam Martinez, stated that the agency was in “wind-down mode.”
The CFPB employees said that, if directed to by the court, they would provide their names and titles under seal.

DOGE role

The bureau has long been a target of Republicans and financial institutions, who have called it a rogue agency that exceeded its legal authority in punishing companies. More recently, Musk has taken up the cause; he posted on his X platform, “RIP CFPB,” earlier this month just as his DOGE operatives began their work.
In several instances in the testimony, senior CFPB staff appeared to defer to DOGE employees for critical matters.
For instance, DOGE worker Jordan Wick “specifically stated” that Musk’s ad hoc group wanted a massive round of layoffs by Feb. 14.
“The Bureau intended to comply and fire the vast majority of remaining employees on February 14th,” Alex Doe said. “The only reason it did not do so is because of this Court’s order.”
In other instances, DOGE workers asked CFPB staff about how deeply they could cut operations while adhering to statutory requirements in areas like consumer response, per testimony from CFPB worker Matthew Pfaff.
Despite gaining full access to CFPB systems and data on Feb. 7, the DOGE employees haven’t yet completed the cybersecurity and privacy training required by the agency, the employees testified.

Legal requirements

While Musk and Vought have openly advocated for the termination of the CFPB, only Congress can truly shutter the agency, which was created after lawmakers passed the 2010 Dodd-Frank Act.
Vought’s moves appear to allow him to claim the CFPB still exists, while sidelining its role by drastically curtailing its ability to supervise companies and respond to complaints.
CFPB employees question whether a handful of employees could credibly fulfill the dozens of statutory requirements of the agency, which include responding to millions of consumer complaints filed via web and phone lines, as well as maintaining advocacy offices for military veterans and senior citizens.
On Thursday, Jonathan McKernan, President Donald Trump’s pick to take over at the CFPB for Vought, told lawmakers including Sen. Elizabeth Warren, the Massachusetts Democrat credited with spurring the agency’s creation, that he would “fully and faithfully” enforce laws related to the CFPB’s mission.
McKernan added that if confirmed by the Senate, he would “rightsize” the CFPB, as well as “refocus it” and “make it accountable.”
Noting that Vought, who is also head of the Office of Management and Budget, has canceled the lease on the agency’s headquarters, Sen. Jack Reed, D.-R.I., told McKernan that he was in a “very difficult position.”
“You do not appear to have much presidential support or OMB support, and I have this sinking feeling that you’re departing Liverpool on the Titanic,” Reed said. “Good luck.”

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Omar Marques | Lightrocket | Getty Images

There’s a new ETF in town. SPDR SSGA Apollo IG Public & Private Credit ETF (PRIV) will trade Thursday at the NYSE. 
This fund intends to invest at least 80% of its net assets in investment grade debt securities, including a combination of public credit and private credit. What’s surprising is that there is a significant component of private credit in the ETF wrapper. Because private credit is illiquid, it has been a problem getting this in an ETF wrapper, since ETFs need liquidity. 

They are trying to solve this problem by having Apollo provide credit assets and they will purchase those investments back if need be. 
ETFs have owned illiquid investments in the past (there are bank loan ETFs that have illiquid investments) so this is not the first time this issue has been addressed. But Wall Street is eager to provide access to private equity and credit to the masses, and ETFs are the obvious wrapper.
Normally, ETFs are only allowed to own illiquid investments up to 15% of the fund, but the SEC says that in this case private credit can range between 10% and 35%, but can be above or below that.
This filing has been controversial. One early concern was that if Apollo is the only firm providing the liquidity, it naturally raises questions about what type of pricing State Street will get. However, State Street apparently can source from other firms if it can get better prices.
Another issue: Apollo is required to buy back the loans, but only up to a daily limit, and it’s not clear what happens after that. It’s not clear if the market makers would accept private credit instruments for redemption.

Bottom line: This is a groundbreaking but very complicated ETF. It will be closely monitored for liquidity.
Note: Anna Paglia, executive vice president, chief business officer for State Street Global Advisors, will be on ETF Edge Monday to explain how this ETF works. More

President Donald Trump’s pick to lead the Consumer Financial Protection Bureau on Thursday withstood grilling from Democrat Senators who asked him repeatedly to confirm that he would uphold his legal obligations to run the agency.
Jonathan McKernan, a former Federal Deposit Insurance Corporation board member, told lawmakers he would “fully and faithfully” enforce laws related to the CFPB’s mission.
Sen. Elizabeth Warren pressed McKernan on if he would uphold CFPB’s statutory requirements, including having a website and toll-free line for consumer complaints, as well as maintaining advocacy offices for military veterans and senior citizens.

Jonathan McKernan, U.S. President Donald Trump’s nominee to be the director of the Consumer Financial Protection Bureau, sits on the day he testifies during a Senate Banking, Housing and Urban Affairs Committee confirmation hearing on Capitol Hill in Washington, D.C., U.S., February 27, 2025. 
Annabelle Gordon | Reuters

President Donald Trump’s pick to lead the Consumer Financial Protection Bureau on Thursday withstood grilling from Democrat senators who repeatedly asked him to confirm that he would uphold his legal obligations to run the agency.
Pressed by senators including Elizabeth Warren of Massachusetts, Jonathan McKernan, a former Federal Deposit Insurance Corporation board member, told lawmakers he would “fully and faithfully” enforce laws related to the CFPB’s mission.

“My legal career started just as the 2008 financial crisis was beginning,” McKernan said. “Watching that crisis unfold left me with an enduring conviction that we must have a financial regulatory system that works for everyday Americans. Consumer protection is critical to that end.”
Still, McKernan made it clear that he disagreed with how predecessor Rohit Chopra ran the agency. In opening remarks, he said that the CFPB “acted in a politicized manner,” exceeded its legal authority, hurt consumers by inadvertently raising prices and suffered from a “crisis of legitimacy.”
“This must be corrected if the CFPB is to reliably do what it’s supposed to do: look out for the American consumer,” said McKernan, a former corporate banking lawyer and Senate aide.
Since acting CFPB Director Russell Vought took over this month, the agency has shuttered its Washington headquarters, fired about 200 employees and told those who remain to stop nearly all work. Those moves, along with an allegation from a CFPB union that Vought intends to fire more than 95% of the agency’s staff, has spurred fears that the agency faces extinction.
Earlier Thursday, the CFPB dismissed at least four enforcement lawsuits, including actions against Capital One and a Berkshire Hathaway unit.

U.S. Sen. Elizabeth Warren (D-MA) speaks at a rally outside the Consumer Financial Protection Bureau (CFPB) on Feb. 10, 2025 in Washington, DC. 
Anna Moneymaker | Getty Images

Warren pressed McKernan on if he would uphold CFPB’s statutory requirements, including having a website and toll-free line for consumer complaints, as well as maintaining advocacy offices for military veterans and senior citizens.
“Each of the offices I think you mentioned is mandated by statute,” McKernan said. “Yes, I’ll follow the law.”
Rattling off a list of public comments and steps made by the Trump administration that indicate the bureau could be shuttered entirely, Warren questioned how effective McKernan could be.
“It kind of feels like you’ve been lined up to be the No. 1 horse at the glue factory,” Warren said.
For his part, McKernan said that if confirmed by the Senate, he would “right-size” the CFPB, as well as “refocus it” and “make it accountable.”
Sen. Jack Reed, D.-R.I., followed up, adding that Vought has canceled the lease on the agency’s headquarters and dismissed cases against “predatory lenders.” Reed also mentioned reporting that both Trump and Vought, who is also head of the Office of Management and Budget, want to eliminate the bureau.
“You’re going to be placed in a very difficult position,” Reed said. “You do not appear to have much presidential support or OMB support, and I have this sinking feeling that you’re departing Liverpool on the Titanic. Good luck.”
McKernan didn’t verbally respond to Reed’s comment, only smiling ruefully while nodding slightly. More

The Consumer Financial Protection Bureau’s new leadership on Thursday dismissed at least four enforcement lawsuits undertaken by the previous administration’s director.
In legal filings, the CFPB issued a notice of voluntary dismissal for cases involving Capital One; Berkshire Hathaway-owned Vanderbilt Mortgage & Finance; a Rocket Cos. unit called Rocket Homes Real Estate; and a loan servicer named Pennsylvania Higher Education Assistance Agency.
“The Plaintiff, the Consumer Financial Protection Bureau, dismisses with prejudice this action against all Defendants,” the agency said in a brief filing in the Capital One case. It used similar language in the other cases.

Russell Vought, director of the Office of Management and Budget (OMB) nominee for US President Donald Trump, during a Senate Budget Committee confirmation hearing in Washington, DC, US, on Wednesday, Jan. 22, 2025. 
Al Drago | Bloomberg | Getty Images

The Consumer Financial Protection Bureau’s new leadership on Thursday dismissed at least four enforcement lawsuits undertaken by the previous administration’s director.
In legal filings, the CFPB issued a notice of voluntary dismissal for cases involving Capital One; Berkshire Hathaway-owned Vanderbilt Mortgage & Finance; a Rocket Cos. unit called Rocket Homes Real Estate; and a loan servicer named Pennsylvania Higher Education Assistance Agency.

“The Plaintiff, the Consumer Financial Protection Bureau, dismisses with prejudice this action against all Defendants,” the agency said in the Capital One case. It used similar language in the other cases.
The moves are the latest sign of the abrupt shift at the agency since acting CFPB Director Russell Vought took over this month. In conjunction with Elon Musk’s Department of Government Efficiency, the CFPB has shuttered its Washington headquarters, fired about 200 employees and told those who remain to stop nearly all work.
Under former Director Rohit Chopra, the CFPB accused Capital One of bilking customers out of more than $2 billion in interest; it said Vanderbilt ignored signs that customers couldn’t afford its mortgages; it accused Rocket of providing illegal kickbacks to real estate agents; and it said that loan servicer Pennsylvania Higher Education Assistance Agency improperly collected loans.
A Capital One spokesman said the bank welcomed the dismissal of its case, which it “strongly disputed.”
A spokesman for Rocket also lauded the news: “Rocket Homes has always connected buyers with top-performing agents based only on objective criteria like how well they helped homebuyers achieve their dream of homeownership. We are proud to put this matter behind us.”

Shares of Capital One and Rocket climbed after the dismissals.

Billions lost

Current and former CFPB employees have told CNBC that legal cases with upcoming docket dates would likely be dismissed as the agency disavows most of what Chopra has done.
That began late last week, when the agency dismissed its case against SoLo Funds, a fintech lender it had earlier accused of gouging customers.
Eric Halperin, the CFPB’s former head of enforcement, said in a phone interview Thursday that the spate of CFPB dismissals was unprecedented in the bureau’s history.
“Five cases have been dismissed so far by this administration, whereas in the entire history of the bureau, there’s only been one other case dismissed without relief for any consumers,” Halperin said.
Since the recent cases were dismissed with prejudice, the CFPB has agreed to never bring these claims again, shutting off the possibility of clawing back funds for consumer relief, he added.
“Just from the cases that were dismissed today, there’s billions of dollars in consumer harm that the CFPB will never be able to get back for consumers,” Halperin said.

‘Embarrass you’

The Thursday filings began appearing at the same time that senators were grilling Jonathan McKernan, President Donald Trump’s pick to lead the CFPB on a permanent basis, during a nomination hearing.
“Mr. McKernan, literally while you’ve been sitting here and you’ve been talking about the importance of following the law, we get the news that the CFPB is dropping lawsuits against companies that are cheating American families, or alleged to be cheating American families,” Sen. Elizabeth Warren, D-Mass., said.
“It seems to me the timing of that announcement is designed to embarrass you,” Warren said.

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Qatar Investment Authority’s $1-billion fund of funds has accepted its first group of venture capital fund managers.
Raj Ganguly, co-CEO of B Capital, hailed the Gulf state’s approach to artificial intelligence, and its support for the sector, as of particular interest.
It comes as Qatar looks to diversify away from its dominant oil and gas industry.  

The skyline of Doha, Qatar.
Tim De Waele | Corbis | Getty Images

The Qatar Investment Authority is leveraging its over-$500 billion in assets to attract venture capital firms to the hydrocarbon-rich state.
The sovereign wealth fund’s $1-billion fund of funds program — which invests in both international and regional VC funds — is designed to bolster investments in areas such as technology and health care, as Qatar looks to diversify away from its dominant oil and gas industry.  

Now, it’s accepted its first group of venture capital fund managers.
B Capital, a tech-focused firm led by Facebook co-founder Eduardo Saverin, is among the group of VCs set to launch in Doha, opening its first Middle East office in the Qatari capital. It joins Rasmal Ventures, Utopia Capital Management and Builders VC, which have also joined the program.
Raj Ganguly, co-CEO of B Capital, hailed the Gulf state’s approach to artificial intelligence, and its support for the sector, as of particular interest.
“With all the sandboxes that have been created here in the GCC (Gulf Cooperation Council) to trial new types of AI, we think it’s an incredibly exciting time,” Ganguly told CNBC at Web Summit Qatar in Doha on Monday. “We believe innovation can come from anywhere. We want to back founders from the GCC who have a global mindset.”
B Capital, which focuses on enterprise, fintech, health care and climate investments, has over $7 billion in assets under management and says it targets seed to late-stage growth technology investments.

Mohsin Pirzada, head of funds at QIA – a huge sovereign wealth fund with stakes in prize assets ranging from London’s Harrods to Heathrow Airport — told CNBC that the program has a dual investment mandate.
“Firstly, we seek strong commercial returns and secondly, we seek for positive impact across the VC ecosystem in Qatar,” he said.
He added that the fund of funds was looking for VCs looking to deepen their roots in the country. It aims to “have a beneficial impact on the local economy, to boost deal flow in the market and to support the development of a thriving ecosystem underpinned by a strong private sector,” he added.

A test for Doha

The move comes as Doha faces a particular challenge in attracting financial services firms. In addition to boasting a young, digital-savvy population, many countries in the Middle East also offer incentives to lure storied financial services firms.
Riyadh, for example, has launched a program requiring any company that seeks government contracts to move its regional headquarters to Saudi Arabia, offering corporate tax incentives. The Kingdom has seen several Wall Street firms move to the Saudi capital as a result, including Morgan Stanley, Goldman Sachs, Lazard and BlackRock.
The UAE is also targeting global firms, with billionaire Ray Dalio, hedge fund Brevan Howard, asset manager PGIM and private equity giant General Atlantic all setting up offices in capital Abu Dhabi.
“The key word here is ‘compliment’ — this is a relatively small region, so when one country wins, we all win. If we are all attracting businesses, innovators and helping companies to scale, we will all benefit,” the QIA’s Pirzada told CNBC. More

Market volatility appears to be boosting demand for two types of exchange-traded funds: leveraged and inverse.
And, Direxion CEO and ETF money manager Douglas Yones thinks market conditions will keep fueling demand for them.

“We have a lot of securities in the market that are … up a lot over the last five or 10 years. Market seemingly has been going sideways. We saw Friday’s correction,” he told CNBC’s “ETF Edge” this week. “There are people out there that are saying: ‘Hey, maybe I don’t want to be fully invested,’ but also don’t want to take the capital gain on selling a position. What can I do? I can take a long position in a short ETF and inverse ETF. I can basically neutralize my exposure.”
Leveraged and inverse ETFs give investors the opportunity to make monster bets on the stock market’s direction. Investors can go long or short.

Arrows pointing outwards

Yones’ firm is heavily involved in the space. Yones runs the Direxion Daily Semiconductor Bull 3X Shares (SOXL), which is one of the largest leveraged/inverse ETFs. According to FactSet, Broadcom, Nvidia and Qualcomm are among the ETF’s top holdings.
As of Wednesday’s market close, Yones’ ETF is up almost 84% over the past two years, but off 36% over the past year. It’s also down more than 16% over the past week.
“There are market-moving headlines happening two to three times a day. And so, the volatility is growing up, not down,” said Yones. “We think that holds for the whole year.”

VettaFi’s Todd Rosenbluth also sees growing demand for single-stock leveraged ETFs.
“Single-stock leveraged ETFs probably sound hard to wrap your head around. But it’s one stock you get the risk-on or in case of inverse risk-off exposure to that and the liquidity benefits of the ETF wrapper,” the firm’s head of research said.

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Thirty years ago Siddharth Dube, a writer, visited a small village in northern India near the site of a historic peasants’ revolt. He found plenty that remained enraging: mud huts, primitive ploughs, “barefoot old men” and “bone-thin children”. One older villager, Ram Dass, recalled the bitter deprivation of his younger years, when he would work long days on someone else’s land for the meagre reward of 1.5kg of grain. On cold nights, the poor stuffed rice stalks into old clothes to keep warm. “What did we know what a quilt was?” A man was lucky to own a single pair of shoes from his wedding to his death. More

“A single man of large fortune; four or five thousand a year. What a fine thing for our girls!” In “Pride and Prejudice” Jane Austen did not have to explain to the 19th-century reader what Mr Bingley’s “four or five thousand a year” meant, or why it excited Mrs Bennet. It was obvious. Mr Bingley was an heir. And the surest way to get rich was not by working hard but by marrying the right person. More