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CFPB Fall 2018 rulemaking agenda

October 18, 2018 / Source: CFPB

Fall 2018 rulemaking agenda

By Kelly Cochran – OCT 17, 2018

The Bureau’s general purpose, as specified in section 1021 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act), is to implement and enforce Federal consumer financial law consistently for the purpose of ensuring that all consumers have access to markets for consumer financial products and services and that markets for consumer financial products and services are fair, transparent, and competitive. Under the Regulatory Flexibility Act, Federal agencies must publish regulatory agendas twice a year. As an independent regulatory agency, the Bureau has been voluntarily participating in the Unified Agenda, which is led by the Office of Management and Budget (OMB). 

The Bureau is under interim leadership pending the confirmation of a permanent director. The Bureau is also in the process of implementing various provisions in the Economic Growth, Regulatory Relief, and Consumer Protection Act (EGRRCPA), which was signed into law in May 2018, and of conducting its first assessments of the effectiveness of prior “significant” Bureau rulemakings as required by section 1022(d) of the Dodd-Frank Act. In addition, the Bureau is analyzing more than 86,000 comments received in response to its “Call for Evidence” initiative seeking feedback on Bureau operations and regulations.  Following consideration of these various initiatives, the Bureau expects to refine its rulemaking priorities no later than the Spring 2019 Agenda and will publish an updated statement of priorities at that time.  

Implementing Statutory Directives

Much of the Bureau’s current rulemaking work is focusing on implementing directives mandated in the EGRRCPA, the Dodd-Frank Act, and other statutes.  

The Bureau issued two rules to facilitate the implementation of the EGRRCPA. One rule was an interim final rule that adjusts certain model forms under the Fair Credit Reporting Act in light of EGRRCPA amendments to strengthen consumers’ ability to protect themselves from identity theft.  The other  rule was an interpretive and procedural rule that provided clarification regarding EGRRCPA amendments to the Home Mortgage Disclosure Act (HMDA).  

The Bureau has also added future EGRRCPA projects to this Unified Agenda.  These projects include a rulemaking to exempt certain creditors with assets of $10 billion or less from certain mortgage escrow requirements under the Dodd-Frank Act, and a rulemaking to develop standards for assessing consumers’ ability to repay “Property Assess Clean Energy” financing.  

Some provisions of EGRRCPA do not require Bureau rulemaking to take effect (e.g., sections 101, 104, 106, 107, 109(a), 301, 601).  Even though Bureau rulemaking is not required for these provisions to take effect, the Bureau has noted in the Unified Agenda that notice-and-comment rulemaking may be helpful to better implement or clarify these provisions.

The Bureau is also engaged in a range of other non-rulemaking activities to facilitate EGRRCPA implementation.  For example, the Bureau is reviewing its compliance guides and examination manuals to make appropriate updates, as well as engaging with stakeholders regarding the issuance of guidance to meet the statutory requirements and facilitate compliance.  In particular, EGRRCPA calls upon the Bureau to provide clearer, authoritative guidance on certain issues, in connection with regulations that integrate certain mortgage disclosures under the Truth in Lending Act (TILA) and the Real Estate Settlement Procedures Act (RESPA).

The Bureau has also added a new rulemaking to its agenda to facilitate further implementation of a statutory directive in the 2010 Dodd-Frank Act amendments to HMDA that the Bureau modify or require modification of the public HMDA data for the purpose of protecting consumer privacy interests.  The Bureau expects to issue final guidance in the next few months to govern public disclosure of 2018 HMDA data in accordance with the standards it set for balancing privacy interests in its 2015 final rule to implement the Dodd-Frank Act amendments.  After consideration of stakeholder comments urging that determinations concerning the disclosure of loan-level HMDA data be effectuated through more formal processes, the Bureau also has decided to add a new notice-and-comment rulemaking to govern the disclosure of HMDA data in future years.

In light of the need to focus additional resources on various HMDA initiatives discussed elsewhere in this agenda, the Bureau has adjusted its timeline for implementing the statutory directive contained in section 1071 of the Dodd-Frank Act which amended the Equal Credit Opportunity Act (ECOA) to require financial institutions to collect, report, and make public certain information concerning credit applications made by women-owned, minority-owned, and small businesses.  The Bureau has now reclassified the section 1071 project from pre-rule status to longer-term action status. 

Continuation of Existing Rulemaking

The Bureau announced in January 2018 that it intends to engage in a rulemaking to reconsider a 2017 rule titled Payday, Vehicle Title, and Certain High-Cost Installment Loans which has a compliance date in August 2019.  The Bureau expects to issue a Notice of Proposed Rulemaking by no later than early 2019 that will address reconsideration of the rule on the merits as well as address changes to its compliance date.  

Prior to the enactment of the EGRRCPA, the Bureau had already put a rulemaking on its Spring 2018 Agenda to reconsider aspects of its 2015 rulemaking to implement Dodd-Frank Act amendments to HMDA, including but not limited to the threshold for collecting and reporting HMDA data with respect to open-end lines of credit.  In addition, the Bureau anticipates engaging in notice-and-comment rulemaking to incorporate the EGRRCPA interpretative and procedural rule mentioned above into Regulation C and to further implement ERGGCPA.  The Bureau expects to issue a Notice of Proposed Rulemaking in Spring 2019 to address some or all of the issues related to these HMDA projects. 

 Finally, the Bureau has continued to engage in research and pre-rulemaking activities regarding the debt collection market, which remains a top source of complaints to the Bureau.  The Bureau has also received encouragement from industry and consumer groups to engage in rulemaking to address how to apply the 40-year old Fair Debt Collection Practices Act (FDCPA) to modern collection practices. By March 2019, the Bureau expects to issue a Notice of Proposed Rulemaking addressing such issues as communication practices and consumer disclosures.  

Future Planning

As noted above, the Bureau has a number of workstreams underway that could affect planning and prioritization of rulemaking activity, as well as the way in which it conducts rulemakings and related processes.  For example, in addition to completing its first three statutorily-mandated assessments of prior “significant” rulemakings (Remittance Rule, 2013 RESPA Mortgage Servicing Rule, and Ability-to-Repay-Qualified Mortgage Rule) by January 2019, the Bureau expects to begin work in 2019 on its assessment of the TILA-RESPA Integrated Disclosure Rule.   

The Bureau is considering future activity with regard to specific areas of consumer financial law of significant public interest.  For example, the Bureau announced in May 2018 that it is reexamining the requirements of the Equal Credit Opportunity Act (ECOA) concerning the disparate impact doctrine in light of recent Supreme Court case law and the Congressional disapproval of a prior Bureau bulletin concerning indirect auto lender compliance with ECOA and its implementing regulations.   The Bureau is also considering how rulemaking may be helpful to further clarify the meaning of “abusiveness” under the section 1031 of the Dodd-Frank Act. 

The Bureau expects by no later than the Spring 2019 Agenda to issue a more comprehensive statement of priorities to reflect its ongoing market monitoring and the Bureau’s other activities discussed above.