A federal judge has ruled in favor of the Trump administration, ending a legal battle with New York Attorney General Letitia James over the broad authority granted to cost-cutting officials investigating Treasury Department payments allegedly riddled with wasteful spending.
James, joined by 17 other Democratic attorneys general, had sued to block the U.S. Department of Government Efficiency (DOGE) from conducting a sweeping audit of the Treasury’s payment systems. But on Tuesday, U.S. District Judge Jeannette Vargas of the Southern District of New York dealt a major blow to that effort, lifting the final legal barrier preventing four DOGE employees from carrying out the investigation.
The decision followed the Trump administration’s submission of evidence showing that the employees had undergone proper training to handle sensitive taxpayer data. An earlier court order had already been eased in April after one DOGE staffer completed a similar program and was granted access.
Judge Vargas—a Biden appointee—had previously leaned toward the Democratic attorneys general, agreeing with their argument that Treasury’s protocols for access were poorly defined and possibly unlawful. But with new compliance measures in place, she ultimately cleared the way for the full investigation to proceed.
The latest ruling also frees DOGE from needing a court order each time the austerity agency adds new staff members to the Treasury investigation.
“[T]here is little utility in having this Court function as Treasury’s de facto human resources officer each time a new team member is onboarded,” Vargas wrote in her order, Politico reported. “The parties are in agreement that … the New DOGE Employees should be permitted to have access to (Bureau of the Fiscal Service) payment systems,” she explained.
Treasury DOGE team leader Tom Krause, along with team members Linda Whitridge, Samuel Corcos, and Todd Newman, submitted dozens of pages of documentation detailing the extensive training protocols all employees must complete before gaining access to sensitive Treasury data.
James, who is currently under federal criminal investigation, had previously denounced the DOGE probe as an “illegal power grab” by the Trump administration. She defended the lawsuit as a necessary step to protect the integrity of federal safety net programs like Social Security, Medicaid, and others.
