NJ warns Trump rollback could open floodgates to scams

💳 NJ Attorney General warns Trump plan to gut CFPB could expose residents to more scams

⚖️ Coalition of 24 states — including NJ — suing to block the rollback

📉 Proposal would slash agency staff from 1,700 to about 550, crippling oversight

New Jersey’s top law enforcement official is warning that a major federal rollback could leave residents more exposed to scams.

Attorney General Jennifer Davenport has joined a coalition of 24 states blasting a proposed overhaul of the Consumer Financial Protection Bureau, arguing it would gut the nation’s primary financial watchdog.

The Trump administration plans to dramatically shrink the agency’s workforce and scale back enforcement. Under the latest proposal, the CFPB would drop from about 1,700 employees to roughly 550. Earlier plans aimed to cut it to just 200.

“Hard-working New Jerseyans” could be left vulnerable, Davenport warned, as scams and fraud continue to spike nationwide. She noted that 40% of U.S. adults reported some form of financial fraud in the past year. New Jersey residents lose billions to various scams, reports show.

RELATED: ‘Psychic’ German raked in $13 million in mail scam based in NJ

“The Trump Administration has caused prices to skyrocket and paved the way for scams to escalate, and we will not sit idly by when hard-working New Jerseyans are victimized by corporate wrongdoers," the Democratic appointed official said in a written statement on Monday.

💳 Fewer watchdogs, more scams?

The attorneys general argue the cuts would cripple the agency’s ability to police banks and lenders, especially with plans to slash enforcement staff and supervision teams.

One internal proposal would reduce a key oversight unit from 72 employees to just one. Critics say that’s effectively dismantling oversight of a multi-trillion-dollar financial system.

The CFPB was created after the 2008 financial crisis and has returned more than $21 billion to consumers. But since President Donald Trump returned to office, the agency has already dropped dozens of enforcement cases and rolled back protections.

In President Trump’s second term, the CFPB has largely become inoperable. The bureau’s staff were told shortly after Trump was sworn into office that they should stop doing all work, and whatever work the CFPB has been doing has largely been directed at unwinding the work it did under President Biden and even the work it did in Trump’s first term in office.

Davenport and several states are now suing to block the changes, while a separate legal battle with the agency’s employee union is unfolding in federal court.

The Associated Press contributed to this report.

Report a correction 👈 | 👉 Contact our newsroom