The American Bankers Association and the Consumer Bankers Association this week expressed support for the Consumer Financial Protection Bureau’s recent announcement that it will increase nonbank supervision. The CFPB is authorized for two years to supervise nonbanks that present an immediate risk of harm to consumers.
At the same time, the associations expressed opposition to the CFPB’s procedural rule to establish a process for the agency to release publicly all or part of any decision or order subjecting a nonbank to the agency’s supervision. “The public release of this information would set a harmful precedent by disclosing confidential supervisory information,” ABA and CBA said. “The release also will not provide helpful guidance to regulated entities because the decision or order will be based on inchoate risk assessments resting on incomplete and potentially inaccurate information, not verified illegal conduct based on a full record and analysis.”
The associations instead called for the CFPB to publish a list of nonbanks that are under its supervision and issue editions of Supervisory Highlights that describe the agency’s identification of illegal conduct by nonbanks. The associations also urged the CFPB expeditiously to initiate separate rulemakings to define data aggregators and nonbank consumer installment lenders as larger participants in their respective markets.