CFPB Aims to Simplify Rules and Guidance
On June 17, CFPB Director Rohit Chopra published a blog post summarizing the Bureau’s new efforts to more clearly communicate its expectations to the public, which would ultimately bolster consumer protection overall.
First, the CFPB plans to issue guidance in more simple and straight-forward terms.
Second, the CFPB aims to focus on implementing longstanding Congressional directives that have been ignored, such as consumer access to financial records, transparency in the small business lending industry, and quality control standards for valuation models under Dodd-Frank Act provisions.
Third, the CFPB is considering utilizing other authorities authorized by Congress that would allow for the registration of nonbank financial companies to identify scammers and other bad actors, for example.
Fourth, the Bureau is reviewing rules that it inherited from other agencies that have been tested in the marketplace for several years and may need to be updated, such as rules implementing the Fair Credit Reporting Act originally developed by the Federal Trade Commission.
Fifth, through its new rulemaking petition process implemented in February 2022, the public has the opportunity to provide input by filing comments on any petitions, and increased transparency by making petitions publicly accessible through the Bureau’s website.
Lastly, through the CFPB’s Advisory Opinion program launched in 2020, the CFPB can quickly provide interpretive rules to the public, allowing for greater clarity on existing law.
Putting It Into Practice: As highlighted in this blog post, the CFPB is making efforts to provide market participants with clear guidance. Companies subject to consumer protection laws should continue monitoring CFPB activity for any updated guidance and interpretive materials and ensure that business practices continue to align with regulatory expectations.