In the first week of the Biden administration and upon appointment to his position, Acting Director of the Consumer Financial Protection Bureau (CFPB) Dave Uejio sent out an e-mail to Bureau staff indicating his priorities for the agency moving forward in anticipation of President Biden’s nominee for director, Rohit Chopra is confirmed. A week later, Acting Director Uejio published his e-mail to Bureau staff on the CFPB blog so that the public and financial institutions could see the agency’s shift when it comes to regulation.
In his letter, Uejio established two main priorities that the CFPB will focus on in the immediate future: (1) relief for consumers who have been impacted by the COVID-19 pandemic and its financial effects; and (2) racial equity. Acting Director Uejio expressed concern with the findings in the Bureau’s January 2021 Supervisory Highlights. The highlights contained information that examiners found regarding banks and their role in assisting consumers during the pandemic. Examiners found several significant issues when it came to the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) and Payment Protection Program (PPP).
First, some mortgage servicers have been giving consumers inaccurate or incomplete information about CARES Act forbearances, failed to process these requests, and collected late fees even though these forbearances were approved. Second, there were also servicers that withdrew money on consumers that were in deferment. Further, there were some financial institutions that had set off stimulus payments and unemployment insurance benefits to cover fees and debts, which Compliance Alliance strongly recommends against doing without a legal opinion in the affirmative. While these were only a few examples among the many violations, it is natural that the Supervision, Enforcement, and Fair Lending (SEFL) Division has been directed to take a more aggressive approach in enforcing consumer protections during this time and expediting investigations.
With this prioritization by the CFPB, consumer compliance with anything COVID-19 related becomes increasingly significant. Compliance Alliance has been working to provide members with answers and tools regarding the most recent round of PPP. However, COVID-19 compliance does not end there. Banks must remain vigilant in upholding the spirit of their role in this economic recovery and providing consumers with needed relief. Our PPP Resources for 2021 page as well as our Business Continuity/Pandemic Toolkit can be valuable resources and are updated as new guidance comes out.
Acting Director Uejio also indicated in his letter that it is time for the Bureau to take on a bolder role in upholding racial equity. Naturally, this means fair lending trends and issues becomes a key priority but will only be the beginning point of achieving this overall goal. Banks should remain vigilant and be prepared for changes to come from the CFPB. For example, the CFPB will now be supervising lenders regarding the Military Lending Act. As the CFPB implements these changes, Compliance Alliance will be there to guide you, and assist and protect your consumers along the way.