Consumer Financial Protection Bureau Director Richard Cordray appeared before a Senate Banking Committee hearing on the bureau’s semi-annual report to Congress. In his testimony, Cordray described actions that the CFPB has taken within the last six months to fulfill the bureau’s mandates as charged by the Dodd-Frank Act.
Supervision and enforcement. Cordray told lawmakers that in the six months since its last semi-annual report to Congress, CFPB supervisory actions resulted in financial institutions providing more than $95 million in redress to over 177,000 consumers. Within the same timeframe, the bureau announced orders through enforcement actions for approximately $5.8 billion in total relief for consumers victimized by various violations of consumer financial protection laws, along with more than $153 million in civil money penalties. He stated that the CFPB worked in tandem with other agencies on some enforcement actions, including the Federal Deposit Insurance Corporation, Office of the Comptroller of the Currency, and New York Department of Financial Services.
Cordray outlined additional supervisory undertakings in the past six months, including:
- publishing one issue of Supervisory Highlights, a series intended to inform the industry and public about the CFPB’s supervisory program and discuss broad trends found through examinations; and
- releasing new guidance documents intended to help institutions know what to expect and how to become, or remain, compliant with the law, including bulletins on private mortgage insurance cancellation and termination, the Section 8 housing choice voucher homeownership program, and interstate land sales.
Regulatory activity. Cordray testified that since its last report, the bureau issued regulations modifying and clarifying a number of rules implementing changes made by the Dodd-Frank Act to the laws governing various aspects of the mortgage market, including amendments relating to small creditors and rural or underserved areas under Regulation Z. He stated that the regulations, among other things, increased the number of financial institutions able to offer certain types of mortgages in rural and underserved areas.
Other regulatory action taken within the same timeframe include a rule moving the effective date of the Know Before You Owe mortgage disclosure rule, also known as the Truth in Lending Act/Real Estate Settlement Procedures Act rule (TRID) to Oct.3, 2015, and an interpretive rule on homeownership counseling organizations lists and high-cost mortgage counseling. Cordray testified that the CFPB also issued several other proposed or final rules or requests for information under the Dodd-Frank Act, including a final rule defining larger participants of the automobile financing market and defining certain automobile leasing activity as a financial product or service, which extends the CFPB’s supervision relating to consumer financial protection laws to any nonbank auto finance company that makes, acquires, or refinances 10,000 or more loans or leases in a year, and a request for information regarding student loan servicing.
The CFPB director stated that to support implementation of its rules, the bureau developed a number of plain-language compliance guides that summarize certain rules and has actively engaged in discussions with industry about ways to achieve compliance.
Finally, Cordray said that over the next six months, the CFPB “will continue implementing the Dodd-Frank Act and using its regulatory authority to ensure that consumers have access to consumer financial markets that are fair, transparent, and competitive.”
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