On March 31, 2021, the Consumer Financial Protection Bureau (CFPB) rescinded seven recent policy statements and one bulletin in an effort to ensure compliance with consumer protection laws and reinforce its supervisory and enforcement authority. These rescissions went into effect April 1, 2021.
The policy statements were designed to provide flexibility to financial institutions that faced compliance challenges during the onset of the COVID-19 pandemic. Acting CFPB Director David Uejio has been outspoken about changes in the CFPB’s approach and priorities since taking the helm of the bureau. The policy rescissions signal a renewed emphasis on strict enforcement of consumer protection laws. When announcing the policy rescissions, Uejio stated that “many financial institutions have developed more robust remote capabilities and demonstrated improved operations,” and therefore, financial institutions no longer need these flexibilities “at the expense of consumers.”
Of note are two statements related to the bureau’s overall regulatory supervision and quarterly HMDA reporting:
Statement on Bureau Supervisory and Enforcement Response to COVID-19 Pandemic – Last year, the bureau stated it would consider pandemic-related staffing and other resource challenges faced by financial institutions in deciding to bring supervisory or enforcement action. The bureau also expressed efforts to consider a financial institution’s good faith efforts to comply with regulations and assist members. The bureau now finds that financial institutions have adjusted and modified their operations to deal with pandemic-related concerns and should now be supervised in accordance with the CFPB’s usual processes.
Statement on Supervisory and Enforcement Practices Regarding Quarterly Reporting Under the Home Mortgage Disclosure Act – In March 2020, the CFPB released a notice stating it would not issue an exam finding or bring enforcement action against financial institutions that fail to file quarterly HMDA data. The bureau states that institutions have had enough time to adjust and are now in a better position to continue daily operations while fulfilling reporting obligations under HMDA.
Other statements address:
- Information Collections for Credit Card and Prepaid Account Issuers;
- The Fair Credit Reporting Act and Regulation V in Light of the CARES Act;
- Filing Requirements Under the Interstate Land Sales Full Disclosure Act (ILSA) and Regulation J;
- Regulation Z Billing Error Resolution Timeframes in Light of the COVID-19 Pandemic;
- Electronic Credit Card Disclosures in Light of the COVID-19 Pandemic; and
- Changes to Types of Supervisory Communications (Bulletin)
The seven rescissions signal a return of the CFPB to exercising its full supervisory and enforcement authority.