CFPB  Enforcement

  • RESPA: On May 28th, the CFPB ordered RealtySouth (AL) to pay $500,000 for allegedly violating the Real Estate Settlement Procedures Act (RESPA) by failing to provide adequate disclosures of consumers’ right to choose service providers. The CFPB alleged that RealtySouth suggested that consumers choose RealtySouth affiliate TitleSouth to handle title and closing services rather than clearly stating consumers’ right to “shop around” for the best service and price.  The Department of Housing and Urban Development referred the case to the CFPB. According to the terms of the consent order, RealtySouth must also ensure that its disclosures, as well as its training materials for agents, comply with RESPA.

CFPB Operations

  • Semi-annual report: On May 28th, the CFPB published its fifth Semi-Annual Report to Congress and the President, which reviews the CFPB’s operations from October 1, 2013, through March 31, 2014, including:
    • Supervisory and enforcement actions;
    • Consumer engagement;
    • Rulemaking and guidance;
    • Funding; and
    • Human resources management.

The House Financial Services Committee and Senate Banking Committee customarily hold hearings at which CFPB Director Richard Cordray testifies following the publication of each semi-annual report.

  • Dispute resolution: On May 29th, the CFPB published a notice in the Federal Register (79 FR 30825) to propose a new information collection program, using a telephone survey of 1,000 credit card holders, to “explor[e] consumer awareness of and perceptions regarding dispute resolution provisions in credit card agreements.”  In its notice, the CFPB stated that it is also interested in consumers’ awareness of their ability to opt-out of mandatory pre- dispute arbitration agreements, but added that, for practical reasons, it will not evaluate consumer satisfaction with either arbitration or litigation proceedings.  The CFPB will accept public comments through June 30, 2014.
  • Financial literacy: On May 29th, Director Cordray delivered prepared remarks at a field hearing of the Financial Literacy and Education Commission on youth financial education. Cordray announced that the CFPB will lead a project to, “gather input from state policymakers on resources and information that will be helpful for states to consider when determining the best way to incorporate youth financial education into their programs.” Also at the field hearing, CFPB Assistant Director of the Office of Financial Education Camille Busette elaborated on a related CFPB project to define and measure financial well- being, as well as identify the skills and behaviors through which consumers achieve financial  well-being.

CFPB & Congress

  • CFPB guidance: On May 20th, Rep. Marlin Stutzman (R-IN) introduced H.R. 4684, the “[CFPB] Guidance Transparency Act,” which would provide for a public notice and comment period preceding the CFPB issuing of any “final guidance.” The bill would also require the CFPB to post online all “studies, data, and other analysis” that the CFPB used in developing such guidance.
  • CFPB reform: On May 29th, the full House Financial Services Committee postponed that day’s scheduled markup of several CFPB reform bills.

CFPB  Rulemaking

  • GLB notices: On May 28th, the CFPB published a notice in the Federal Register (79 FR 30485) to extend the public comment period for its proposed rule, published on May 13th, regarding GLB privacy notices (previously reported).  The CFPB will accept public comments through July 14, 2014.
  • Rulemaking agenda: On May 23rd, the CFPB published its Spring 2014 updated rulemaking agenda, highlighting the following areas:
    • Debt collection, a category for which the CFPB has received more than 30,000 consumer complaints, and for which it received more than 23,000 comments in response to its advance notice of proposed rulemaking (ANRP) issued in November 2013;
    • GLBA privacy disclosures, particularly to ease disclosure burdens;
    • Mortgages, including rulemakings required by the Dodd-Frank Act as well as implementation of both RESPA-TILA federal mortgage disclosures and the CFPB’s 2013 mortgage rules; and
    • Defining larger participants “in various markets,” including auto lending.