Federal judge refuses to pause injunction barring DOGE access to Treasury data

MANHATTAN (CN) — The New York federal judge overseeing another judge’s emergency injunction barring unauthorized access the Treasury Department’s central payment on Tuesday denied the Trump administration’s request to vacate the temporary restrictions, which prevent billionaire Elon Musk’s Department of Government Efficiency from accessing sensitive personal data stored on department servers.

“In entering the TRO, it was Judge Engelmayer’s clear intention, as had been requested, to maintain the status quo that existed prior to the adoption of the agency action described in the complaint until such time as a hearing could be held on the preliminary injunction motion,” U.S. District Judge Jeannette Vargas wrote in her opinion denying the administration’s request to vacate the restriction before a hearing scheduled on Friday.

Vargas clarified that the secretary of the Treasury and other Senate-confirmed senior Treasury officers are not prohibited from accessing Treasury’s payment system while Engelmayer’s order is in effect. Neither are contractors who were approved by the Department of Treasury’s chief information officer and engaged before Jan. 20, 2025, to perform routine or emergency maintenance on Bureau of the Fiscal Service systems.

Engelmayer also carved out an exemption for the Federal Reserve Bank of Kansas City “to access BFS payment systems as it did prior to Jan. 20, 2025.”

The temporary restraining order will continue to halt Musk’s so-called DOGE engineers from accessing the system, which controls trillions in federal spending, through Friday when Vargas will hold oral arguments on the constitutional challenge raised by by attorneys general in Democratic states.

In late-night motion over the weekend, the Trump administration called the emergency injunction put in place late Friday “markedly overbroad” in barring the secretary of Treasury and other senior department leadership from carrying out day-to-day duties. It restricts all political appointees, special government employees and non-Treasury federal employees from accessing and potentially rewriting code on data systems within the Treasury’s Bureau of the Fiscal Service payment platform.

The administration also argued the order unnecessarily constrains Federal Reserve employees and outside contractors from accessing the payment systems to perform necessary routine processes and maintenance and to provide operational support.

‘World’s richest man and his friends’

Led by New York Attorney General Letitia James, the coalition of 19 of states seek a declaration that Treasury Department’s policy change is unlawful and unconstitutional, and to permanently block the Trump administration from implementing the Treasury’s new policy of allowing access to its Bureau of Fiscal Services payment systems containing sensitive personal information.

The states claim the Trump administration’s efforts to dismantle government policies through expanded access to the sensitive data exceeds the Treasury’s statutory authority and violates the Administrative Procedures Act, separation of powers doctrine and the take care clause of the U.S. Constitution.

The order, signed by the Barack Obama-appointed Engelmayer, drew an impermissible distinction between “civil servants” and “political appointees,” the Trump administration argued in its petition to vacate.

Musk installed Tom Krause, a former Silicon Valley software executive with ties to DOGE, as the new financial assistant secretary at the Treasury.

DOGE reportedly gained access to several sensitive systems responsible for Social Security and Medicare benefits, salaries for federal personnel, payments to government contractors and grant recipients, tax refunds and thousands of other functions.

Besides Krause, the Trump administration says, only one other Treasury employee — 25-year-old Marko Elez  — had “read only” access to or copies of certain data in the Treasury’s payment systems, subject to restrictions, and access to a copy of certain payments systems’ source code in a “sandbox” environment.

Elez resigned on Feb. 6 after past online posts he made supporting racism and eugenics surfaced; he returned all Treasury equipment and credentials the same day. The Trump administration has vowed to reinstate him.

Attorney General James applauded Engelmayer’s decision, which also required engineers to delete any sensitive they downloaded since Trump’s inauguration last month.

“From the moment Elon Musk and his DOGE employees gained unprecedented access to our personal private data, state bank account details, and other sensitive information, Americans across the country have been horrified," James wrote over the weekend. “I have said it before, and I will say it again: No one is above the law. Now, Americans can trust that Musk — the world’s richest man — and his friends will not have free rein over their personal information while our lawsuit proceeds.”

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