The Consumer Financial Protection Bureau (CFPB) has seen changes in its activities ever since former director Richard Cordray stepped down in November of 2017. His successor, current acting director Mick Mulvaney, has made a series of changes during his tenure on matters as big as the enforcement actions the bureau makes, and as small as shifting around the letters of the agency’s acronym in order to emphasize the word “bureau” over the word “consumer.”
Comparing the enforcement actions taken by the Cordray-led CFPB and the regime led by Mulvaney, Cordray’s enforcement actions in his final year totaled 47 enforcement actions in number. Mulvaney, by comparison, totaled 8 over the course of his first year.
Based on the history of the agency and the changes made under the new leadership, there are several likelihoods for the CFPB in the coming year, according to U.S.-based international law firm Mayer Brown’s recent teleconference titled “Mulvaney’s BCFP: One Year Later.” Mayer Brown partners Ori Lev and Stephanie C. Robinson and associate Anjali Garg presented a comprehensive look at the first year under Mulvaney’s leadership, exploring what has changed — and hasn’t — about its regulatory approach, along with offering up some limited predictions on what we might see from the CFPB/BCFP over the course of 2019.
- More investigations ahead
Mulvaney may be preparing new enforcement investigations for the coming year, based on the bureau issuing CID’s in new investigations, which is typically the first sign of enforcement activity under the regime as led by Mulvaney. “This may mean that a new enforcement strategic direction has been set, and that we will see more investigations opened in the near future,” said Lev in the presentation.
- Payday lending will remain a focus
The bureau may be continuing to primarily focus its attention in the financial sector on the payday loan industry, but may end up easing its perspective on it. Following up on the finalization of a payday lending rule in 2017 prior to Director Cordray’s departure, it wasn’t expected to fully go into effect until August of 2019.
When Mulvaney became acting director, he announced his intent in January to potentially “reconsider” the payday rule, which aimed to prevent payday debt traps by requiring lenders to take steps to make sure borrowers can repay their loans. A judge in the western district of Texas ordered a stay on the rule’s implementation, though, with no indication on when the stay will be further addressed by the court. The bureau also announced it only intends to revisit the “ability to pay” requirements under the rule, as opposed to the rule itself.
- Less, but more of the same
When commenting on possible actions that will be taken by the bureau in the coming year, Lev presented the primary theme that he feels summarizes the general approach of the Mulvaney-led CFPB: “less, but more of the same: less enforcement, but the enforcement activity that did occur was more of the same.”
While predicting future actions is difficult due to the limited enforcement activity exhibited by Mulvaney’s leadership, Lev applied this theme to the forecast of actions it could take in 2019, saying, “it appears that we can continue to expect less of ‘more of the same,’” particularly in the period before Kathleen Kraninger’s expected ascension to Mulvaney’s current position.
When RMD asked the presenters about any indication of CFPB’s interest in the reverse mortgage industry, Lev responded by saying that there is simply no real clue as to whether or not the bureau has taken either a more or less active interest in it.
“Unfortunately, we don’t know whether the CFPB has concerns with new reverse mortgage products,” he said.
Written by Chris Clow