Treasury Sought to Freeze Foreign Aid Payments, Emails Show

In the days after President Trump took office, as Elon Musk’s team began pressing for access to the Treasury Department’s payments system, officials repeatedly said that their goal was to undertake a general review of the system. They said they would observe, but not stop money from going out the door.

But emails reviewed by The New York Times show that the Treasury’s chief of staff originally pushed for Tom Krause, a software executive affiliated with Mr. Musk’s so-called Department of Government Efficiency, to receive access to the closely held payment system so that the Treasury could freeze U.S. Agency for International Development payments.

In a Jan. 24 email to a small group of Treasury officials, the chief of staff, Dan Katz, wrote that Mr. Krause and his team needed access to the system so they could pause U.S.A.I.D. payments and comply with Mr. Trump’s Jan. 20 executive order to halt foreign aid.

“To the extent permitted by law, we would like to implement the pause as soon as possible in order to ensure that we are doing our role to comply with the EO,” Mr. Katz wrote.

The emails viewed by The Times undercut the Treasury’s explanation for why Mr. Krause and his team were given access to the payment system last week. That system disburses more than $5 trillion in funding on behalf of much of the federal government.

The department, now led by Secretary Scott Bessent, has said that Mr. Krause, a Treasury staff member, and his team are conducting an “operational efficiency assessment” that does not involve blocking agency payments.

The possibility of systems at the Treasury’s little-known Bureau of the Fiscal Service being used to stop congressionally authorized spending has stoked alarm among Democrats, who have called for investigations and led protests at the Treasury building.

David Lebryk, formerly the top career official at the Treasury, rebuffed the request to grant access and pause the aid payments.

“I don’t believe we have the legal authority to stop an authorized payment certified by an agency,” he wrote to the group on Jan. 24. Mr. Lebryk, who had been a federal employee for more than 35 years, was pushed out of his job days later for refusing to give Mr. Krause access to the system. Late on Jan. 31, a Friday, Mr. Bessent authorized entry for a team led by Mr. Krause after Mr. Lebryk’s departure.

On Jan. 25, Mr. Krause responded to Mr. Lebryk and said the department should also weigh the legal consequences of the Treasury disbursing payments in violation of the executive order.

“I think this deserves serious consideration as well. I believe we can all feel more comfortable that we hold payment at least to review the underlying payment requests from US Aid now so that we can be given time to consult State,” Mr. Krause wrote, referring to the State Department.

The Trump administration has said the access for Mr. Krause and his team is limited. On Tuesday, the Treasury Department sent a letter to Congress stating that “currently” Mr. Krause and his team “will have read-only access.” After public sector unions sued over the issue, a Justice Department lawyer said in court on Wednesday that only Mr. Krause and Marko Elez, both Treasury employees, had been given access to information in the system, which they have not shared outside the Treasury.

Mr. Elez, a former employee of Mr. Musk’s at both X and xAI, is one of several staffers that DOGE had planned to install at the Treasury. They also include Mr. Krause, a well-established Silicon Valley software executive; Aram Moghaddassi, who has worked for both X and Mr. Musk’s Neuralink; and Michael Russo, a Silicon Valley executive who has since been named chief information officer of the Social Security Administration. Mr. Elez did not return requests for comment.

Mr. Bessent, in an interview on Wednesday with the Fox Business Network, defended DOGE’s work and dismissed the suggestion that the Treasury’s payment system was compromised.

“Our payment system is not being touched,” he said, adding that the Treasury was studying how to improve accountability, accuracy and the ability to trace where money is going. Mr. Bessent said that any stoppage of payments would happen “upstream” within agencies.

Mr. Bessent also described Mr. Musk as the greatest entrepreneur of his generation and said that the backlash over his actions was happening because he was shaking up the federal bureaucracy.

“They are moving a lot of people’s cheese here in the capital,” Mr. Bessent said. “And when you hear you hear this squawking, then some status quo interest is not happy.”

The push for access to the Treasury system came as the Trump administration moved to dismantle U.S.A.I.D., the government’s lead agency for providing humanitarian assistance globally. Much of the agency’s work force will be put on leave this week, and contracts have been halted.

Agencies across the government send files of sensitive data to the Bureau of the Fiscal Service, directing it to send money to individual Americans, contractors or state governments. Treasury officials conduct a final round of checks on the files, including by scanning them to see if any recipients are barred from receiving government funds, before authorizing the payments, which are then made by the Federal Reserve.

Because the process includes sensitive information about Americans, such as bank account numbers, a relatively small number of Treasury officials are typically involved.

Democrats have questioned whether Mr. Musk’s team in fact has only “read-only” access to the payment system. In a post on X, Senator Sheldon Whitehouse, a Rhode Island Democrat, wrote that Mr. Musk’s team could “manipulate data, steal data, and leave back doors. Your privacy gone.”

“The intern running Sheldon’s social media account seems very upset,” Mr. Musk responded, adding a crying laugh emoji.

Charlie Savage contributed reporting.