The Bureau of Consumer Financial Protection also released the proposed interim rules relating to investigations (Title 12, Chapter X, Part 1080, in case you're keeping track). The rules apply to Bureau investigations conducted pursuant to section 1052 of the Act (12 U.S.C. 5562).
The Bureau is authorized to " act only in the public interest and will not initiate an investigation or take other enforcement action when the alleged violation is merely a matter of private controversy and does not tend to affect adversely the public interest." We expect that as the Bureau attempts to utilize its investigatory powers that the courts will be called upon to determine whether the alleged violation is merely a matter of private controversy or whether the alleged violation affects the public interest. We also expect that the courts will also need to clarify the specific public interests that the investigations are designed to protect.
To aid it in its civil investigations, the Bureau may compel any person to furnish documents, tangible things, written reports or answers to questions, oral testimony or any combination of such material. The person or entity upon which the request is served may petition the Executive Secretary of the Bureau with a copy to the Assistant Director of the Division of Enforcement within 20 days after service. The petition must set forth all assertions of privilege or other factual and legal objections to the demand, and include any appropriate arguments, affidavits, and other supporting documentation. The objection must be signed by an attorney.
In addition to the information requests, the Bureau is authorized to conduct "investigational hearings," as distinguished from hearings in adjudicative proceedings. The investigational hearings may also be used to ensure that a respondent is complying with an order of the Bureau. Interestingly, any person compelled to submit documentary material, tangible things, or written reports or answers t o questions, or to testify in a hearing is entitled to retain a copy or request a copy of materials (at his or her own costs), or a transcript of his or her testimony. However, the Bureau may for good cause deny such a request and limit the witness to inspection of the official transcript of the testimony. The witness is required to be given an opportunity to review the transcript, and may provide the Bureau with an errata sheet for any changes the witness may have to the testimony. The witness must, however, also give the reason for the change of his or her testimony.
The Bureau's enforcement power seems to be a bit tangential. In cases of failure to comply with the Bureau's civil investigative demands, the Bureau may initiate an enforcement action in the district court of the United States for any judicial district in which a person resides, is found, or transacts business, in connection with the failure or refusal of such person to comply with, or to obey, a civil investigative demand. The Bureau may seek contempt or other appropriate relief in cases where a court order enforcing a civil investigate demand has been violated.
The Bureau may also refer investigations to other appropriate federal, state, or foreign governmental agencies. When the facts disclosed by an investigation indicate that an enforcement action is not necessary or would not be in the public interest, the investigational file is to be closed, but the matter may be further investigated at any time, if the circumstances so warrant.
Finally, the Bureau is authorized to request approval from the Attorney General of the United States to grant immunity under 18 U.S.C. 6004 for any individuals required to testify or provide other information. Additionally, Bureau investigations are to be kept confidential and the existence of an investigation is to be disclosed only to potential witnesses or third parties to the extent necessary to advance the investigation.
Let the questioning begin...