CFPB Sets Out Rulemaking Agenda
Last week, the Consumer Financial Protection Bureau (CFPB) quietly released its spring rulemaking agenda, which sets forth five rules that the CFPB expects to complete before May 31, 2023. Unlike in the past, the CFPB did not issue a press release or post the agenda on its website. As required by law, the CFPB submitted the agenda to the Office of Budget and Management, which subsequently published it.
The five rulemakings are as follows:
A rule to implement Section 1033 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), which requires a covered entity (such as a bank) to make available to consumers upon their request transaction data and other information concerning a consumer financial product or service that they have obtained from the covered entity. The CFPB published an Advance Notice of Proposed Rulemaking in November 2020 concerning implementation of Section 1033 and seeking comments.
An interagency rule (with other federal banking agencies) to implement an amendment to the Financial Institutions Reform, Recovery, and Enforcement Act (FIRREA) under the Dodd-Frank Act concerning appraisal automated valuation models (AVMs). The FIRREA amendment requires implementing regulations for quality control standards for AVMs. These standards are designed to ensure a high level of confidence in the estimates produced by the AVMs, protect against the manipulation of data, avoid conflicts of interest, require random sample testing and reviews, and account for any other factors the agencies determine to be appropriate.
A rule to implement Section 1071 of the Dodd-Frank Act relating to data collection for women-owned, minority-owned, and small-business loans under the Equal Credit Opportunity Act. The CFPB issued a proposed rulemaking to implement Section 1071 in October 2021. This rulemaking is being watched very closely by the financial services industry and has been a topic of much discussion. The CFPB’s next action is the issuance of the final rule, which it expects to issue by March 2023.
A rule to implement a provision of the National Defense Authorization Act, which was enacted in December 2021, that amended the Fair Credit Reporting Act to prohibit consumer reporting agencies from furnishing a consumer report containing any adverse item of information about a consumer that resulted from a severe form of trafficking in persons or sex trafficking if such documentation was provided to the consumer reporting agency.
A rule to implement Section 307 of the Economic Growth, Regulatory Relief, and Consumer Protection Act, which amended the Truth in Lending Act (TILA) to require the CFPB to prescribe regulations relating to Property Assessed Clean Energy (PACE) financing. As defined in Section 307, PACE financing results in a tax assessment on a consumer’s real property and covers the costs of home improvements. The required regulations must carry out the purposes of TILA’s ability-to-repay (ATR) requirements, currently in place for residential mortgage loans, with respect to PACE financing and apply TILA’s general civil liability provision for violations of the ATR requirements the CFPB will prescribe for PACE financing.
In a blog post on June 17 titled “Rethinking the Approach to Regulations,” CFPB Director Rohit Chopra referenced that, among other actions, the CFPB is reviewing a host of rules issued in the previous decade that have been “tested in the marketplace for many years and are in need of a fresh look,” and specifically referenced the Qualified Mortgage Rule. The CFPB’s rulemaking agenda did not include a reference to any rulemaking associated with modifying the Qualified Mortgage Rule.