On July 20, the Bureau published its Spring 2017 rulemaking agenda as part of the Spring 2017 Unified Agenda of Federal Regulatory and Deregulatory Actions. The preamble states that the information is current as of April 7, 2017. Thus, the semiannual regulatory agenda does not reflect the issuance of the CFPB’s final arbitration rule that was published in the Federal Register on July 19 or any other rulemaking activity that has occurred after April 7 (e.g., proposed changes to the Prepaid Account Rule or recent amendments to the TRID Rule). In addition, the information presented in the agenda could be subject to significant change if Director Cordray leaves the CFPB this fall as many are expecting.
Here is a brief rundown of the rulemaking initiatives that are reflected in the Unified Agenda:
Payday, title, and deposit advance loans
In June 2016, the CFPB released a Notice of Proposed Rulemaking for payday, title, and high-cost installment loans. The comment period ended on October 22, 2016. The agenda states that the Bureau is “carefully considering more than one million comments received in response to the proposal” and anticipated completing the initial review of comments in June 2017. The agenda does not, however, give an estimated date for a final rule.
Last July, the CFPB issued an outline of the proposals in anticipation of convening a SBREFA panel. The coverage of the CFPB’s SBREFA proposals was limited to “debt collectors” that are subject to the FDCPA. At that time, the CFPB also indicated that it intended to convene a second SBREFA panel in the “next several months” to address a separate rulemaking for creditors and others engaged in debt collection not covered by the proposals. However, Director Cordray announced in June 2017 that the CFPB has elected to begin its debt collection rulemaking by focusing on disclosures and treatment of consumers by debt collectors. Cordray explained that the Bureau would later create a separate rule addressing “right consumer, right amount” issues that will cover first- and third-party collections.
According to the agenda, the Bureau expects to issue a proposed rule in September 2017. That rule will address FDCPA collectors’ communications practices and consumer disclosures. The CFPB intends to follow up separately about concerns regarding information flows between creditors and FDCPA collectors and about potential rules to govern creditors that collect their own debts. The agenda does not provide estimated dates for the convening of a second SBREFA panel or a proposed second rule.
The CFPB states in the Spring 2017 agenda that it “expects to conduct a rulemaking to define larger participants in the markets for consumer installment loans and vehicle title loans for purposes of supervision.” It also repeats the statement made in previous agendas that the CFPB is “also considering whether rules to require registration of these or other non-depository lenders would facilitate supervision, as has been suggested to the Bureau by both consumer advocates and industry groups.” (Pursuant to Dodd-Frank Section 1022, the CFPB is authorized to “prescribe rules regarding registration requirements applicable to a covered person, other than an insured depository institution, insured credit union, or related person.”) The new agenda estimates a June 2017 date for prerule activities and a September 2017 date for a proposed rule.
In the agenda, the CFPB states that it “is continuing to engage in additional research and has begun consumer testing initiatives related to the opt-in process.” The Fall 2016 Agenda estimated a January 2017 date for further pre-rule activities; the new agenda adjusted that date to June 2017.
The extended timeline may reflect that the Bureau believes issuing a rule addressing overdraft practices is less urgent because most banks subject to CFPB supervision have already changed their overdraft systems to avoid a high-to-low dollar amount order to process electronic debits.
Small business lending data
Dodd-Frank Section 1071 amended the ECOA to require financial institutions to collect and maintain certain data in connection with credit applications made by women- or minority-owned businesses and small businesses. That data includes the race, sex, and ethnicity of the principal owners of the business.
The Spring 2017 Agenda estimates a June 2017 date for pre-rule activities. The CFPB states that it “is focusing on outreach and research to develop its understanding of the players, products, and practices in business lending markets and of the potential ways to implement section 1071. The CFPB then expects to begin developing proposed regulations concerning the data to be collected and determining the appropriate procedures and privacy protections needed for information-gathering and public disclosure under this section.”
The CFPB issued a proposed covering the circumstances under which a lender may use of a Closing Disclosure to determine if an estimated charge was disclosed in good faith. The Spring 2017 Agenda estimates that a final rule will be issued in March 2018.
According to the Spring 2017 Agenda, the Bureau is also conducting two follow-up rulemakings to facilitate compliance with its prior rule to implement Dodd-Frank amendments to HMDA, which largely takes effect in 2018, as well as provisions of the Equal Credit Opportunity Act that also concern data collection and reporting. The Bureau is also continuing to work closely with industry and other regulators to streamline and modernize HMDA data collection and reporting in conjunction with implementation of the Dodd-Frank amendments.