CFPB Announces Civil Investigative Demand Policy Change Reflecting ACA International’s Comments on Reform

Updated policy includes more information about business activities subject to the bureau’s enforcement authority.

4/23/2019 1:00 PM

NewsCFPB
CFPB Announces Civil Investigative Demand Policy Change Reflecting ACA International’s Comments on Reform

Considering comments from industry stakeholders, including ACA International’s call for the Consumer Financial Protection Bureau to reduce the burden and cost of complying with the Civil Investigative Demand (CID) process, the bureau announced it has updated its CID policies to ensure they provide more information about the potentially wrongful conduct under investigation.

“ACA applauds the bureau for addressing concerns raised in ACA’s comments in response to the Request for Information about the CID process,” said CEO Mark Neeb. “More transparency in this process benefits both consumers and ACA members.”

According to a news release from the CFPB, “consistent with the updated policy, (Civil Investigative Demands) will provide more information about the potentially applicable provisions of law that may have been violated. CIDs will also typically specify the business activities subject to the bureau’s authority. In investigations where determining the extent of the bureau’s authority over the relevant activity is one of the significant purposes of the investigation, staff may specifically include that issue in the CID in the interests of further transparency.”

ACA International submitted comments on the bureau’s CID policies as part of its Request for Information series conducted in 2018.

“In general, the bureau should revise its approaches to align with specific investigative concerns and objectives, which would reduce the burden and cost of complying with the CID process, avoiding unnecessary disruption of business and excessive compliance costs, including employee overtime. The bureau should provide notice to CID recipients as to the basis for the investigation and allow an opportunity to rebut or offer context for allegations,” Neeb said in the comment letter. “This could save time and resources for all parties and lead to faster results, producing a fairer process and orienting the investigation on changes needed to protect consumers.”

Many parties contributing to ACA’s comments also classified the bureau’s past CID process as “regulation by enforcement.”

According to the CFPB news release, the new policy also considers recent court decisions about notifications of purpose in addition to comments received during the Request for Information process. It is also consistent with a 2017 report by the bureau’s Office of Inspector General that emphasized the importance of updating Office of Enforcement policies to reflect such developments.

The Consumer Financial Protection Act of 2010 authorizes the bureau to issue investigational subpoenas known as CIDs when looking into potential violations of law. The act provides that each CID “shall state the nature of the conduct constituting the alleged violation which is under investigation and the provision of law applicable to such violation.” CIDs issued by the bureau set out this information in a section known as the “notification of purpose.”

Related Content from ACA International:

ACA International Submits Comments on Bureau of Consumer Financial Protection Civil Investigative Demands

Federal Trade Commission Comments on CFPB Civil Investigative Demand Processes


Follow ACA International on Twitter @ACAIntl and @acacollector, Facebook and request to join our LinkedIn group for news and event updates. ACA International members are welcome to submit news items for possible publication to comm@acainternational.org. Visit our publications page for news submission guidelines and subscriptions to ACA Daily, Collector magazine and Pulse.

Advertising is available for companies wishing to promote their products or services. Be sure to visit the ACA Events Calendar on the Education and Training page to view our listing of upcoming CORE Curriculum and Hot Topic seminars featuring critical educational opportunities for your company.


Subscribe to ACA Daily NEWSROOM

CFPB Announces Civil Investigative Demand Policy Change Reflecting ACA International’s Comments on Reform

Considering comments from industry stakeholders, including ACA International’s call for the Consumer Financial Protection Bureau to reduce the burden and cost of complying with the Civil Investigative Demand (CID) process, the bureau announced it has updated its CID policies to ensure they provide more information about the potentially wrongful conduct under investigation.

“ACA applauds the bureau for addressing concerns raised in ACA’s comments in response to the Request for Information about the CID process,” said CEO Mark Neeb. “More transparency in this process benefits both consumers and ACA members.”

According to a news release from the CFPB, “consistent with the updated policy, (Civil Investigative Demands) will provide more information about the potentially applicable provisions of law that may have been violated. CIDs will also typically specify the business activities subject to the bureau’s authority. In investigations where determining the extent of the bureau’s authority over the relevant activity is one of the significant purposes of the investigation, staff may specifically include that issue in the CID in the interests of further transparency.”

ACA International submitted comments on the bureau’s CID policies as part of its Request for Information series conducted in 2018.

“In general, the bureau should revise its approaches to align with specific investigative concerns and objectives, which would reduce the burden and cost of complying with the CID process, avoiding unnecessary disruption of business and excessive compliance costs, including employee overtime. The bureau should provide notice to CID recipients as to the basis for the investigation and allow an opportunity to rebut or offer context for allegations,” Neeb said in the comment letter. “This could save time and resources for all parties and lead to faster results, producing a fairer process and orienting the investigation on changes needed to protect consumers.”

Many parties contributing to ACA’s comments also classified the bureau’s past CID process as “regulation by enforcement.”

According to the CFPB news release, the new policy also considers recent court decisions about notifications of purpose in addition to comments received during the Request for Information process. It is also consistent with a 2017 report by the bureau’s Office of Inspector General that emphasized the importance of updating Office of Enforcement policies to reflect such developments.

The Consumer Financial Protection Act of 2010 authorizes the bureau to issue investigational subpoenas known as CIDs when looking into potential violations of law. The act provides that each CID “shall state the nature of the conduct constituting the alleged violation which is under investigation and the provision of law applicable to such violation.” CIDs issued by the bureau set out this information in a section known as the “notification of purpose.”

Related Content from ACA International:

ACA International Submits Comments on Bureau of Consumer Financial Protection Civil Investigative Demands

Federal Trade Commission Comments on CFPB Civil Investigative Demand Processes


Follow ACA International on Twitter @ACAIntl and @acacollector, Facebook and request to join our LinkedIn group for news and event updates. ACA International members are welcome to submit news items for possible publication to comm@acainternational.org. Visit our publications page for news submission guidelines and subscriptions to ACA Daily, Collector magazine and Pulse.

Advertising is available for companies wishing to promote their products or services. Be sure to visit the ACA Events Calendar on the Education and Training page to view our listing of upcoming CORE Curriculum and Hot Topic seminars featuring critical educational opportunities for your company.


Subscribe to ACA Daily NEWSROOM

Loading...

Loading...

Scroll to Top