The government efficiency unit backed by Elon Musk is turning its attention to the SEC as the Trump administration purges federal workers and revamps agencies’ priorities.
Hundreds of the Securities and Exchange Commission’s 5,000 employees may quickly face termination, if the SEC follows the Department of Government Efficiency playbook and dismisses recent hires, who have fewer job protections than longer-time employees. The Consumer Financial Protection Bureau and Federal Deposit Insurance Corp. have fired more than 200 new employees combined and are planning more layoffs, as Musk and President Donald Trump push to shrink government.
Trump and Musk haven’t signaled an interest in completely dismantling the SEC. But the commission can run with a substantially diminished staff in an emergency. The SEC during the first Trump administration identified about 80% of its workforce as non-essential during a government shutdown.
DOGE now is seeking “insights on finding and fixing waste, fraud and abuse relating to the Securities and Exchange Commission,” according to a Feb. 17 message on an account the unit recently launched for the SEC on Musk’s X platform. Musk called the SEC a “totally broken organization” after the agency sued the billionaire in January over claims he failed to make timely disclosures related to his takeover of Twitter, which he renamed X.
An SEC spokesperson declined to comment on any plans to cull the agency’s workforce or transfer staff to address different priorities. Here’s how the Trump administration’s purge could hit the SEC:
1. Are any SEC units protected from elimination?
Some offices, like those for minority and women inclusion and the investor advocate, are mandated by federal law. Others, including regional offices and divisions handling securities law enforcement, corporate filing reviews, and examinations, are not, though statutes require many of their functions.
Even if federal law protects an office, however, the SEC still could hobble it by significantly reducing its staff through layoffs or transfers. Project 2025, a roadmap for the Trump administration, urged the SEC to merge offices “performing similar functions” and move resources “away from ancillary and support functions.”
Eliminating offices isn’t uncommon. The SEC shuttered its Salt Lake Regional Office in 2024. The commission in 2009 folded its Office of Economic Analysis and Office of Risk Assessment into what is now known as the Division of Economic and Risk Analysis. The agency also regularly opens and closes units within its Enforcement and Corporation Finance divisions.
2. How could the SEC gut its workforce?
Probationary employees would be easier to remove given they are new hires with fewer job protections than more senior workers. About 300, or roughly 6%, of the SEC’s nearly 5,000 workers were on the job less than a year in 2024, according to Office of Personnel Management data on DOGE’s website.
A more drastic workforce cull could put the SEC’s staffing in line with what the agency deemed essential to function amid a government shutdown during the first Trump administration, when thousands were furloughed.
3. How is the SEC funded?
The independent agency’s budget is set by Congress through appropriations, offset by transaction fees the regulator collects from securities exchanges. Annual collections have historically exceeded the SEC’s yearly appropriations and are paid directly into the Treasury’s general fund.
President Donald Trump issued an executive order on Tuesday, seeking to rein in the SEC and other independent agencies by requiring them to submit draft regulations to the White House for review and consult with the administration on agency priorities and strategic plans. The Office of Management and Budget will adjust the agency’s apportionments to ensure tax dollars are spent wisely, according to the executive order.
4. How could staffing cuts align with shifting enforcement and legal priorities?
Enforcement staff made up 1,595 of 5,621 positions, or 5,073 full-time equivalents, in the SEC’s 2025 budget request to Congress, including lawyers and others working at agency headquarters and in 10 regional offices. But changing priorities could jeopardize jobs for swaths of that workforce dedicated to crypto- and foreign bribery-related actions.
An executive order in January halted enforcement of the Foreign Corrupt Practices Act, which prevents US citizens and other entities from bribing foreign officials to benefit business interests. The SEC also has put in its own bids to pause crypto-based litigation, indicating staff who focused on those areas may be terminated or reassigned.
Ex-Chief Litigation Counsel Jorge Tenreiro, whom the agency moved from its enforcement division into an information technology role, was a top crypto litigator for the SEC prior to his sudden reassignment earlier this month.
The SEC also backed off its legal defense of climate reporting rules championed by ex-Chair Gary Gensler, asking the US Court of Appeals for the Eighth Circuit not to schedule arguments in a rule challenge brought by Republican state attorneys general and business interests.
Attorneys within the agency’s office of general counsel, who handle non-enforcement matters related to rulemaking and challenges to self-regulatory organizations, may also be pulled from open cases if they’re reassigned or terminated. The SEC had requested a budget for 180 general counsel positions in fiscal year 2025, an increase of just seven from the year prior, according to the agency report to Congress.
5. How has DOGE approached other agencies?
DOGE has acted swiftly to slash the federal workforce and effectively shut down certain regulators. At the CFPB, Musk and the government efficiency staffers have taken steps to cut contracts, access internal data, fire probationary employees and fellows, and otherwise halt agency work.
The Trump administration also appears to be preparing to transfer employees from the FDIC and CFPB to the Office of the Comptroller of the Currency in a broader effort to reshape bank supervision. The president hasn’t formally announced a plan to relocate those employees or make a general overhaul.
The Silicon Valley mantra of moving fast and breaking things has generally applied to DOGE’s approach thus far, but some of the moves have already drawn court challenges.
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