The Elon Musk ally who helped to lead a group of twentysomething whiz kids as they seized control of a sensitive payment system at the U.S. Treasury Department has been unmasked as a private equity hatchet man with a long track record of instituting layoffs in the private sector.
Tom Krause, the CEO of Cloud Software Group, said on Wednesday in an email to employees that he would not be giving up his role as chief executive at the technology firm while he helped Musk’s so-called Department of Government Efficiency, or DOGE, make cuts across the federal government. Kraus was initially identified by The Washington Post. Kraus did not respond to The Post to a request for comment.
In the meantime, Krause is also classified as a “special government employee” with a top secret security clearance and who is subject to federal ethics requirements, according to a letter sent Tuesday to Sen. Ron Wyden from Jonathan Blum, the Treasury’s principal deputy assistant secretary for legislative affairs.
Blum also assured Wyden that Krause and the team at DOGE would only have “read-only” access to the Treasury Department’s systems—although internal emails obtained by CNN contradict that claim.
The federal government is the latest institution that Krause has been tasked with gutting.
Krause gained notoriety in the industry after he became known for converting software products to subscription services and rocketing up prices as much as tenfold, hurting the small businesses that rely on them, according to The American Prospect.
In 2022, cloud computing firm Citrix, which was later renamed Cloud Software Group, hired Krause as CEO as it merged with a smaller company known as Tibco Software.
Cloud Software Group laid off 1,000 people in 2022, several thousand more in 2023, and another few hundred just last month.
“To get to where I know this company can go requires us to completely rethink how we operate and organize at every level of the business and rebuild our go-forward plans looking to the future instead of the past,” Krause reportedly told staff in an internal email.
His cost-cutting efforts didn’t stop there. Krause also eliminated a variety of employee perks, refused to pay vendors, and shut down offices.
David Morgan, a disabled Air Force veteran who joined Cloud Software Group around the same time as Krause, told The American Prospect that the CEO “runs everything into the ground.”
“The dude is a heartless person who should not be in any line of business, but especially not in the government sector,” Morgan said. If DOGE wants to cut the fat in government, Krause should “look in the mirror [and] cut off Citrix,” he says.
Already, Krause’s aggressive approach, which he perfected in the private sector, is ruffling feathers in the federal government.
When acting Treasury Secretary David Lebryk objected to the Trump administration’s demand to shut off all payments to USAID due to legal reasons, Krause disagreed.
Lebryk left the department by the end of that week. Since then, the Trump administration has said it will keep on less than 300 of the 10,000 employees at USAID.
Krause isn’t a disaffected leader to the DOGE kids, either.
Krause and Marko Elez, the 25-year-old engineer who was granted access to the Treasury’s payment system, traveled to a federal facility in Kansas City last week to meet with staff responsible for the highly sensitive system, according to Bloomberg.
Elez resigned Thursday after he was linked to a social media account that pushed racist and eugenicist theories.
