Judge Halts Access to Treasury Payment Systems by Elon Musk’s Team

 

Judge Halts Access to Treasury Payment Systems by Elon Musk’s Team

 

The order came in response to a lawsuit filed by 19 attorneys general accusing the president of failing to faithfully execute the nation’s laws when he let DOGE comb through federal computer systems.

 

By Hurubie Meko and Qasim Nauman

Published Feb. 7, 2025

Updated Feb. 8, 2025, 11:27 a.m. ET

https://www.nytimes.com/2025/02/07/nyregion/attorneys-general-trump-musk-suit.html

 

A federal judge early Saturday temporarily restricted access by Elon Musk’s government efficiency program to the Treasury Department’s payment and data systems, saying there was a risk of “irreparable harm.”

 

The Trump administration’s new policy of allowing political appointees and “special government employees” access to these systems, which contain highly sensitive information such as bank details, heightens the risk of leaks and of the systems becoming more vulnerable than before to hacking, U.S. District Judge Paul A. Engelmayer said in an emergency order.

 

Judge Engelmayer ordered any such official who had been granted access to the systems since Jan. 20 to “destroy any and all copies of material downloaded from the Treasury Department’s records and systems.” He also restricted the Trump administration from granting access to those categories of officials.

 

The defendants — President Trump, Treasury Secretary Scott Bessent and the Treasury Department — must appear on Feb. 14 before Judge Jeannette A. Vargas, who is handling the case on a permanent basis, Judge Engelmayer said.

 

The situation could pose a fundamental test of America’s rule of law. If the administration fails to comply with the emergency order, it is unclear how it might be enforced. The Constitution says that a president “shall take Care that the Laws be faithfully executed,” but courts have rarely been tested by a chief executive who has ignored their orders.

 

Federal officials have sometimes responded to adverse decisions with dawdling or grudging compliance. Outright disobedience is exceedingly rare. There has been no clear example of “open presidential defiance of court orders in the years since 1865,” according to a Harvard Law Review article published in 2018.

 

Saturday’s order came in response to a lawsuit filed on Friday by Letitia James of New York along with 18 other Democratic state attorneys general, charging that when Mr. Trump had given Mr. Musk the run of government computer systems, he had breached protections enshrined in the Constitution and “failed to faithfully execute the laws enacted by Congress.”

 

The lawsuit was joined by the attorneys general of Arizona, California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Massachusetts, Minnesota, Nevada, New Jersey, North Carolina, Oregon, Rhode Island, Vermont and Wisconsin.

 

They said the president had given “virtually unfettered access” to the federal government’s most sensitive information to young aides who worked for Mr. Musk, who runs a program the administration calls the Department of Government Efficiency, or DOGE.

 

While the group was supposedly assigned to cut costs, members are “attempting to access government data to support initiatives to block federal funds from reaching certain disfavored beneficiaries,” according to the suit. Mr. Musk has publicly stated his intention to “recklessly freeze streams of federal funding without warning,” the suit said, pointing to his social media posts in recent days.

 

In her own social media post on Saturday, Ms. James reiterated that members of the cost-cutting team “must destroy all records they’ve obtained,” and added: “I’ve said before, and I’ll say it again: no one is above the law,” she wrote.

 

New Jersey’s attorney general, Matthew J. Platkin, said in a post on Saturday that the injunction meant “the world’s richest man has been stopped from stealing your data.”

 

Efforts to reach press officers at the White House were not immediately successful on Saturday morning.

 

In a statement on Thursday, after the attorneys general said they would sue, a spokesman for the president said that Mr. Musk’s team was acting legally. “Slashing waste, fraud and abuse, and becoming better stewards of the American taxpayer’s hard-earned dollars might be a crime to Democrats, but it’s not a crime in a court of law,” said the spokesman, Harrison Fields.

 

Although the court order mandates an immediate halt to the Musk employees’ access to the Treasury Department’s payment system, it was not immediately clear when or if they would fully comply. Nor was it clear how the attorneys general would monitor the administration’s actions.

 

In a previous action, 23 attorneys general sued Mr. Trump’s freeze of federal grants and won a temporary pause on Jan. 31, with a judge ordering the administration to stop withholding funds. However, on Friday, the coalition appealed to the judge again, saying that the money was still being withheld from states, grantees and programs.

 

Mr. Trump has had scant success in the courts in years past. His first administration succeeded in only about 23 percent of the legal challenges against the actions of his agencies, a review found, while prior administrations won about 70 percent of the time.

 

But Mr. Trump’s new term is already a thing apart.

 

The administration’s “shock and awe” approach since he was inaugurated last month has seen new policies and actions arrive at breakneck speed. On his first day in office, Mr. Trump pardoned members of the mob that attacked the Capitol on Jan. 6, 2021. He has signed dozens of executive orders, withdrawn the country from international agreements and even tried to install himself as chairman of the John F. Kennedy Center for the Performing Arts in Washington.

 

The aggressive approach is beginning to be tested by scores of lawsuits on a host of issues, but the legal system’s ability to restrain the administration remains uncertain.

 

If federal officials fail to comply with the Saturday order limiting DOGE, the judge may hold them in contempt, said Daniel C. Richman, a Columbia Law School professor and a former federal prosecutor in Manhattan. Courts have done that in the past, he said, “albeit rarely.”

 

“A contempt citation can come with fines, more likely imposed on the officials, rather than the government itself, and even possible imprisonment,” Mr. Richman said.

 

In 2002, Interior Secretary Gale A. Norton was held in contempt for failing to fix the department’s management of billions of dollars in royalties earned on American Indian land. The following year, a federal appeals court found that she could not be held in criminal contempt for problems that existed before her tenure.

 

Although contempt findings can be “devoid of sanction, they nonetheless have a shaming effect,” which is often enough to spur officials to compliance, Nicholas Parrillo, a professor at Yale Law School, wrote in the 2018 Harvard Law Review article.

 

However, he wrote, the “rise of partisan polarization could potentially fracture the pro-compliance community so badly that members of one party would refuse to acknowledge the shame of a contempt finding against a member of their own camp.”

 

Since Mr. Trump entered office last month, Mr. Musk has so far been unconstrained. When DOGE first turned its attention to the Treasury Department, a top official refused to give members access, leading to a standoff. The official, David Lebryk, was put on leave before suddenly retiring.

 

Almost immediately, Mr. Musk’s team was given access to the government’s most fundamental computer data, including the U.S. Treasury Department’s payment system, which is used to disburse funds including Social Security benefits, veteran’s benefits and federal employee wages.

 

The system — which channels about 90 percent of the payments for the U.S. government, which spent about $6.75 trillion last fiscal year — pays funds directly to people in the states, as well as to state governments, the suit says.

 

Before Mr. Trump took office last month, access was granted to only a limited number of career civil servants with security clearances, the suit said. But Mr. Musk’s efforts had interrupted federal funding for health clinics, preschools and climate initiatives, according to the filing.

 

The money had already been allocated by Congress. The Constitution assigns to lawmakers the job of deciding government spending.

 

“President Trump does not have the power to give away Americans’ private information to anyone he chooses, and he cannot cut federal payments approved by Congress,” Ms. James said in a statement. “Musk and DOGE have no authority to access Americans’ private information and some of our country’s most sensitive data.”

 

The case is one of many resisting Mr. Trump’s aggressive actions since he took office last month.

 

Three unions this week sued the U.S. Office of Personnel Management, the government’s human resources division, to block an effort to persuade roughly two million federal employees to resign.

 

Two anonymous sets of F.B.I. agents and employees sued to keep the Trump administration from releasing the identities of people who worked on investigations into the Capitol riots on Jan. 6, 2021. They won an order on Friday requiring the administration to keep their names secret.

 

Attorneys general have challenged Mr. Trump’s executive order attempting to end birthright citizenship. This week, Ms. James warned New York hospitals that complying with a White House executive order seeking to end gender-affirming medical care for young people could violate state law.

 

The actions of DOGE — bulldozing through the federal government — have been confounding and concerning to Democratic lawmakers and federal employees.

 

With license from Mr. Trump, Mr. Musk’s mandate appears to be vast: His team has tried to shut down the U.S. Agency for International Development, a key international source of foreign assistance. On Friday, a federal judge in Washington ordered a pause on an effort to put 2,200 U.S.A.I.D. employees on leave and rapidly withdraw employees stationed abroad.

 

On Friday, Mr. Trump said that Mr. Musk would turn his attention to the Pentagon, which has billions of dollars in contracts with companies Mr. Musk owns.

 

The heart of the lawsuit filed by the coalition on Friday was focused on Mr. Musk’s access to the Treasury Department. The department’s system is a repository of some of Americans’ most sensitive information, including Social Security and bank account numbers, which the attorneys general said puts residents of their states at personal risk.

 

Nathan Willis contributed reporting.

 

Hurubie Meko is a Times reporter covering the New York Police Department and criminal justice in the New York region. More about