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Federal employees who help the Trump administration implement a dramatic reduction in the Consumer Financial Protection Agency own stakes in companies that can benefit from the demolition of agents, Propublica research found.
Gavin Kliger, a 25-year-old aide to the Government Efficiency Bureau, disclosed his investment earlier this year in a public financial report listing up to $365,000 worth of stocks from four companies that the CFPB can regulate. He later helped oversee layoffs for more than 1,400 employees at the department, according to court records and government emails.
Ethics experts say this constitutes a conflict of interest and that Krigger’s actions are a potential violation of federal ethics law.
Enforcement department employees are subject to laws and regulations that prohibit them from addressing issues that “affect your own personal financial interests.” Additionally, CFPB employees will need to sell from a number of additional specific companies engaged in financial services.
CFPB oversees companies that provide a variety of financial services, including mortgage lending, car financing, credit cards, and payment apps.
The two companies where Kliger is invested in (Apple and Tesla) are on the CFPB’s banned list. Two other people – Bitcoin and Solana are not on the list, but they are still banned under agency guidance on investing in cryptocurrency companies.
Court records show that Kliger is one of the few top CFPBs and administrative authorities discussing the implementation of layoffs via email. Separately, a federal employee working on the layoff team said Kliger had “controlled” the filing of about 90% of the department’s staff earlier this month, according to a declaration of oath submitted by lawyers against the administration.
The employee said he learned about Kliger’s role from a colleague using the pseudonym Alex Doe for fear of retaliation, and the declaration stated that Kliger would “have straightened CFPB employees for 36 hours and made notifications available.” “Gavin was screaming at people who didn’t think he was working fast enough,” and “called them incompetent.”
Among the people fired were the ethics teams at the agency, according to the agency’s lawyer who wrote in court on April 25th that “doesn’t know that it remains in the CFPB, which has the expertise necessary to meet the federal ethics requirements of the CFPB.”
Ethics experts said that eliminating surveillance will help relieve companies from compliance costs and exposures stemming from enforcement actions, removing government regulators that oversee companies and set industry-wide rules could affect the stock prices of companies that are subject to that regulation.
“I think destroying the CFPB is likely to have a direct and predictable impact on his financial stocks,” says Kathleen Clark, a government ethics expert at Washington University in St. Louis.
Union Bureau employees sued Russell Vought, the agency’s acting director, to close its operations and halted the administration’s efforts to cut down staff. The months that followed have been choked up.
At the end of March, a district court judge issued a drastic stay against the administration’s actions. Then, on April 11, the Court of Appeals in Washington, D.C. partially lifted the stay. In that order, the panel wrote that “specific assessments” must be carried out before the bureau leaders can fire workers.
A few days later, most of the agency staff were informed that they had been fired.
Mark Paoletta, the department’s chief justice officer, and two other lawyers, have conducted a court order review, the government said in legal documents. In a recent submission, Paoletta writes that the administration is trying to achieve a “rationalized right-sized office.” Instead of the 248 executives and 487 employees in the supervisory department, he planned to maintain 50 workers each, he wrote.
However, on Monday evening amid a heated debate over the legality of shootings and the definition of “specific ratings,” the appeals court retreated, and the court upheld its first stay in a massive layoff as the case unfolded. The CFPB subsequently notified more than 1,400 fired employees that their termination had been cancelled. The lawsuit is ongoing and there will be oral debate before the court of appeals scheduled for next month.
Kliger did not respond to voicemails or emails seeking comment on the story. The CFPB did not respond to requests for comment.
In a statement, the White House said “these allegations are another attempt to reduce Doge’s critical mission.”
Krigger “didn’t even manage the layoffs,” the statement said, “had made this entire story a complete lie.”
Asked to clarify Kliger’s role in the administration’s cuts, the spokesman said, “There are 90 days since the start of the sale, which is May 8th, and it is only April 28th.” It is unclear what rules the White House referenced. The spokesman did not respond to follow-up questions. However, ethics experts said there are two scenarios that can be applied. Sometimes it is to pledge high-level government officials to sell their holdings on a specific date to avoid conflicts of interest. In particular, the CFPB, regulations allow employees to have 90 days to sell prohibited possessions.
However, in each case, employees must reject themselves from actions that could affect their investment.
Delaney Marsco, a government ethics expert at the Campaign Legal Centre, said his involvement in the holding of Krigger and the introduction of the agency would erode the public’s belief that government officials are in their best interests.
“When you have these facts, it raises questions. It’s as bad as when you have an actual violation, because you’re asking public questions,” she said.
Kliger owns between $15,000 and $50,000 in Apple, which is regulated by the CFPB. The company agreed to pay a $25 million civil penalty last October, following a bureau investigation into Apple Card, a credit card for the company’s software. The bureau said it didn’t have a proper transaction dispute system when Apple launched, and also said it misunderstood some customers about fundraising. The company has agreed to the consent order, records show that “without accepting or denying the facts or conclusions of the law.” In a statement at the time, Apple said “strongly opposes CFPB’s characteristics of Apple’s actions, but they agree with the agreement.”
Kliger owns between $100,000 and $250,000 in Tesla stocks. Founded by Doge Boss Elon Musk, the company falls within the department’s scope as it provides funding, a key area of CFPB scrutiny.
Kliger also owns cryptocurrency. Solana is between $1,000 and $15,000, and Bitcoin between $15,000 and $50,000.
According to a legal memo issued in July 2022, if employees know that a particular issue can have a direct and predictable impact on the value of a cryptocurrency or stability, then “federal workers who hold cryptocurrency or something stupid may not be able to participate in a particular issue if they know of a particular issue,” the then presidential representative was issued by an independent federal agency, as independent executive executive agencies avoid fighting.
Elon Musk’s demolition crew
An internal notification to CFPB employees the following month directed those with such retention to “quickly refuse to address certain issues at the Bureau.” Records reviewed by ProPublicaShow were reported and sold within 90 days.
Since the start of President Donald Trump’s second presidency, the administration has sought to significantly reduce the size, scope and nature of the American consumer watchdog created in the wake of the 2008 financial crisis.
Propublica reported last month that dozens of investigations launched by the agency had stagnated amid a stoppage order.
In a recent court submission supplementing the newly released policy memo, Paoletta wrote in recent years that “the bureau has also been involved in the exposure of unwanted fisheries to depository institutions, increasingly engaged in non-depository institutions,” including “judicial judges and other judges for loans from peers, rents, and other rentals.”
