December 9, 2018

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CFPB Seeks Comment on its Enforcement Processes

The CFPB has issued a request for information that seeks comment on how the agency can best achieve meaningful burden reduction or other improvement in the processes it uses to enforce federal consumer financial law while continuing to meet the CFPB’s statutory objectives and ensuring a fair and transparent process.  Comments on the RFI must be received no later than 60 days after the date it is published in the Federal Register, which the CFPB expects to be February 12, 2018.

The new RFI represents the third in a series of RFIs announced by Mick Mulvaney, President Trump’s designee as Acting Director.  The new RFI is broader than the two prior RFIs, which focused on specific aspects of enforcement.  In the new RFI, the CFPB now seek comment on all aspects of its enforcement processes but lists the following seven topics:

  • Communication between the CFPB and subjects of investigations, including timing and frequency of such communications and information provided by the CFPB on the status of an investigation

  • Length of CFPB investigations

  • Notice and Opportunity to Respond and Advise (NORA) process, including whether the NORA process should be mandatory rather than discretionary and the information contained in letters the CFPB may send to potential subjects of investigations pursuant to the NORA process

  • Whether subjects of potential enforcement actions should have the right to make an in-person presentation to the CFPB before the CFPB decides whether to initiate legal proceedings

  • Calculation of civil money penalties, including whether the CFPB should adopt a civil penalty matrix

  • Standard provisions in CFPB consent orders

  • Manner and extent to which the CFPB can and should coordinate enforcement activity with other federal and/or state agencies with overlapping jurisdiction

The CFPB’s first RFI, which has a March 27, 2018 comment deadline, seeks comment on the CFPB’s processes surrounding civil investigative demands and investigational hearings.  The second RFI, which has a comment deadline of April 6, 2018, seeks comment on how the CFPB can improve its administrative adjudication processes.  In its press release announcing the third RFI, the CFPB stated that the next RFI in the series will be issued next week and will address the Bureau’s supervisory processes.

Copyright © by Ballard Spahr LLP

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About this Author

Christoper Willis, Partner, Ballard Spahr law firm, Consumer Financial Services Litigation attorney
Partner

Christopher J. Willis is Practice Leader of the firm's Consumer Financial Services Litigation Group. He devotes his practice to assisting financial services institutions facing government investigations and examinations, counseling them on fair lending risk and compliance assessments, and defending them in individual and class action lawsuits brought by consumers and enforcement actions brought by government agencies.

Mr. Willis also chairs the firm's Fair Lending Task Force. His clients span the financial services industry and include banks and...

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James Kim, Ballard Spahr Law Firm, Los Angeles, Financial Law Litigation Attorney
Of Counsel

Mr. Kim advises companies and individuals in matters involving financial regulation and litigation, and the myriad of federal consumer financial laws, such as Title X of Dodd-Frank (UDAAP), TILA, RESPA, EFTA, and the FDCPA. He has represented clients in examinations and investigations with the Consumer Financial Protection Bureau (CFPB), Federal Deposit Insurance Corporation (FDIC), Office of the Comptroller of the Currency (OCC), U.S. Department of Justice (DOJ), U.S. Securities and Exchange Commission (SEC), and various state and local agencies. His practice focuses on cutting-edge issues, including financial technology (FinTech), mobile financial services, and marketplace lending.

In addition to his regulatory work, Mr. Kim has tried, as first or second chair, more than 20 cases to verdict, and has briefed criminal and civil appeals before the U.S. Court of Appeals for the Second Circuit and the New York State Appellate Division.

646-346-8089