Banking

CFPB to analyze nonbanks for customer threats

The Consumer Financial Protection Bureau today stated it would conjure up a “largely unused” authority under the Dodd-Frank Act to straight analyze nonbank monetary providers. “Given the rapid growth of consumer offerings by nonbanks, the CFPB is now utilizing a dormant authority to hold nonbanks to the same standards that banks are held to,” stated CFPB Director Rohit Chopra. “This authority gives us critical agility to move as quickly as the market, allowing us to conduct examinations of financial companies posing risks to consumers and stop harm before it spreads.”

The bureau today upgraded a 2013 procedural guideline that executes its statutory authority to monitor nonbanks “whose activities the CFPB has reasonable cause to determine pose risks to consumers,” consisting of unreasonable, misleading or violent acts or practices. The upgraded guideline would excuse decisions and orders from the CFPB director from being thought about personal supervisory details—indicating that they might be openly launched by the bureau. The guideline works upon publication in the Federal Register and has a 30-day remark duration.

In addition to its authority to analyze nonbanks that might posture customer threats, under Dodd-Frank, the bureau has direct supervisory authority over nonbanks in the home mortgage, trainee loan and payday advance loan markets, along with bigger individuals in other nonbank customer monetary item markets, and the bureau has actually performed rulemakings to specify bigger individuals in customer reporting, financial obligation collection, trainee loan maintenance, remittances and automobile loan maintenance. The bureau likewise straight monitors banks and cooperative credit union with more than $10 billion in properties. Read the procedural guideline. https://files.consumerfinance.gov/f/documents/cfpb_public-release-of-decisions-and-orders_procedural-rule_2022-04.pdf

Gabriel

A news media journalist always on the go, I've been published in major publications including VICE, The Atlantic, and TIME.

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