By John Zasada, JD, CAMS – Shareholder, Financial Institutions Group

On June 17, 2022, the Consumer Financial Protection Bureau (CFPB) released a blog post about the CFPB’s transition of intending to issue less complicated rules and more guidance. The CFPB notes regulators have historically issued complicated and tailored rules instead of guidance and rules adaptable to a changing marketplace. It wishes to write simple and straightforward rules.

The CFPB acknowledges overly complicated rules are relatively harder for smaller institutions to understand and comply with. It intends to issue simple, bright-line guidance and rules, minus unintended loopholes, to limit the need for high-priced lawyers and creative lawyering. The result should be more consistency among regulators enforcing laws and regulations.

The CFPB is reviewing rules issued by other agencies and other rules it thinks need a fresh look, including the following:

  • Rules originally developed by the Federal Reserve Board of Governors under the Credit CARD Act of 2009
  • Rules originally developed by the Federal Trade Commission to implement the Fair Credit Reporting Act
  • The CFPB’s Qualified Mortgage Rules to explore ways to spur streamlined modification and refinancing in the mortgage market, as well as assessing aspects of the “seasoning” provisions.

The CFPB will increase its interpretation of existing laws via its Advisory Opinion program. It will promote consistency among enforcement agencies via the Consumer Financial Protection Circulars. The result should be greater clarity to financial institutions by encouraging consistent enforcement among government agencies.

For more information on the impact of new regulations on your financial institution, contact Doeren Mayhew’s regulatory compliance specialists today.