CFPB Kicks Off Regulatory Review with Call for Public Comments

The Consumer Financial Protection Bureau’s acting director has begun to implement his plan to reshape the consumer watchdog’s mission, issuing the first in a string of requests for public comment on its actions last week.

First on the docket: Civil investigative Demands, a kind of legal action in which the bureau asks companies to provide documents and other information about their practices during the course of an investigation. 

“The bureau issues CIDs in accordance with the law and in furtherance of its investigatory objectives,” the bureau wrote in its request for public comment. “The bureau understands, however, that responding to a CID can impose burdens on the recipients.”

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The CFPB, currently led by acting director and White House budget director Mick Mulvaney, specifically wants to hear from representatives of companies that have been the subject of CIDs in the past, law firms that represented such firms, and members of the general public. 

The goal, according to the CFPB, is to streamline the process and reduce regulatory pressures on financial companies. That’s been a consistent message from Mulvaney since he took the reins from former direct Richard Cordray last year: Just last week, Mulvaney took to the pages of the Wall Street Journal to declare that the era of “pushing the envelope” at CFPB was over, and that the agency would focus on balancing the needs of consumers with the rights of corporations.

The request for comment is the first in a line of multiple promised chances for the industry to weigh on on the CFPB’s mission and enforcement levers in the coming months. Interested parties have until late March to send comments on CIDs via Regulations.gov, e-mail, or postal mail.

Professional CFPB watchers say that unlike in years past, when some in the financial industry felt their comments fell on deaf ears, the current Washington climate is ripe for regulatory change.

“With the recent change of leadership, we anticipate a CFPB that will be more receptive to the concerns of industry,” attorneys Christopher Willis, James Kim, and Theodore Flo of Ballard Spahr wrote in the firm’s Consumer Finance Monitor blog. “We therefore view the request as an important opportunity for the industry to argue for permanent changes to the CID process, and to make the CID process more efficient, less expensive, and fairer to the targets of investigations.”

Written by Alex Spanko