The Consumer Financial Protection Bureau (CFPB), working in partnership with multiple state regulators, announced on September 10 that it has launched the American Consumer Financial Innovation Network (ACFIN) to strengthen coordination among federal and state regulators in order to facilitate financial innovation. ACFIN is a network of federal and state officials and regulators with authority over markets for consumer financial products and services. The CFPB invited all state regulators to join ACFIN, and the initial members of ACFIN are the attorneys general of Alabama, Arizona, Georgia, Indiana, South Carolina, Tennessee, and Utah. The network may include state attorneys general, state financial regulators, and federal financial regulators.

According to the CFPB’s press release, ACFIN “enhances shared objectives such as competition, consumer access, and financial inclusion. Additionally, ACFIN promotes regulatory certainty for innovators, benefiting the US economy and consumers alike. The network also seeks to keep pace with market innovations and help ensure they are free from fraud, discrimination, and deceptive practices.”

The AFCIN charter provides that the AFCIN members “intend to facilitate innovation that benefits consumers through greater competition, consumer access, or financial inclusion in markets for consumer financial products and services,” and that such innovation can be facilitated within the United States through cross-jurisdictional coordination and information sharing. To accomplish this objective, the charter provides that the members intend to

  • coordinate innovation-related policies, procedures, and activities such as office hours, with the opportunity to also coordinate on no-action letters or similar programs, or sandbox trials if desired; and
  • share information, as appropriate, related to innovation in markets for consumer financial products and services, including technical expertise, market intelligence, and best practices.

We note that none of the actions undertaken under the auspices of ACFIN will be for the purpose of preempting state law.

While CFPB Director Kathleen L. Kraninger states that she “will continue to work to encourage other state regulators to join this important new initiative that will foster collaboration among federal and state regulators,” stay tuned to see if the announcement solicits any responses from states/attorneys general not part of the network that opposed the CFPB’s work in this area.

In addition, the CFPB finalized a number of innovation policies on September 10, including the No-Action Letter (NAL) Policy, Trial Disclosure Policy, and Sandbox Policy. The CFPB also released its second NAL, and first under the new policy, to the US Department of Housing and Urban Development regarding the application of the Real Estate Settlement Procedures Act to housing counselors. We will provide summaries and additional commentary in short order.