On December 12th the Consumer Financial Protection Bureau (“CFPB”) published a proposed rule titled “Registry of Nonbank Covered Persons Subject to Certain Agency and Court Orders.” The rule is directed at nonbank entities that fall under the CFPB’s enforcement authority.
The Bureau desires to create a registry of all final public orders and judgments (including consent and stipulated orders) arising from violations of certain consumer protection laws and regulations. The rule will require that covered entities who are under certain orders relating to the offering or provisioning of a consumer financial product to report those orders to a CFPB registry, regardless of whether those orders are from a federal, state, or local agency. The proposed rule also provides that the registry would be published online for use by the public and other regulators.
In addition to the creation of a registry of such orders, the proposed rule would require that entities under such an order submit annual written statements certifying compliance with the underlying order. The statements would need to be signed by an attesting executive of the entity who possesses knowledge of the order and the company’s systems and processes.
While the proposed rule is currently intended to target only nonbank entities, in a blog post on December 12th the CFPB signaled a desire for potentially expanding the rule to cover insured banks and credit unions. In the blog post the Bureau stated:
While the CFPB might later consider collecting or publishing the information described in the proposal from insured banks and credit unions, there is currently greater need to collect this information from nonbanks under its jurisdiction.
There will be a 60-day comment period starting when the proposed rule is published in the Federal Register. It is advisable for any entity that falls under CFPB supervision, not just the nonbank entities the rule targets, to review proposal for a full understanding of its provisions and applicability.
Please click here to read the proposed rule.
Please click here to read the CFPB blog post.