Advisory bulletin provides an overview for entities subject to the bureau’s supervisory and enforcement authority.
3/6/2020 9:00
The Consumer Financial Protection Bureau has issued an updated bulletin on activities individuals and businesses subject to its regulation and enforcement could engage in to prevent and minimize consumer harm.
The updated bulletin is part of several steps by the bureau to advance preventing consumer harm, according to a news release from the CFPB.
The CFPB steps also include:
- Implementing an advisory opinion program to provide clear guidance to assist companies in better understanding their legal and regulatory obligations through advisory opinions; and
- Engaging with Congress to advance proposed legislation that would authorize the bureau to award whistleblowers who report violations of federal consumer financial law.
“These steps reinforce the bureau’s commitment to preventing consumer harm. Advisory opinions will ensure that companies know what compliance entails and what constitutes a violation. We also want to incentivize whistleblowers to contact us if they believe their employer is not complying with the law,” CFPB Director Kathy Kraninger said in the news release.
The updated bulletin on responsible conduct, according to the CFPB, stems from the original guidance published in June 2013.
“[It] is intended to clarify the bureau’s approach to responsible business conduct and emphasize the importance of such conduct. Responsible conduct can improve the bureau’s ability to promptly detect violations, increase the effectiveness of its supervisory and enforcement work, enable the bureau to better focus its finite resources, and help more consumers get redress,” according to the CFPB news release.
The bulletin includes four categories of responsible business conduct:
- Self-assessing
- Self-reporting
- Remediation
- Cooperation.
“If an entity meaningfully engages in these activities, the bureau will favorably consider it, along with other relevant factors, in addressing violations of federal consumer financial law in supervisory and enforcement matters,” according to the CFPB news release.
“Responsible conduct is in the public interest. Entities that build a culture of compliance and engage in responsible conduct support consumer protection and the bureau’s efforts to both prevent harm to consumers and enforce the law against bad actors,” Kraninger said.
Other Updates Include Amending Title X of Dodd-Frank
Meanwhile, the two additional consumer protection updates include proposed legislative language to amend Title X of the Dodd-Frank Act and provide the CFPB authority to establish a whistleblower award program.
The CFPB also announced changed to its advisory opinion program, including how it will prioritize requests for the opinions, which include interpretations of the bureau’s existing rules.
“To increase transparency and to provide regulatory certainty to all regulated entities and other stakeholders, the bureau will publish the responding advisory opinion in the Federal Register and on its website,” according to the news release. “Under a current guidance process, responses to individual regulatory inquiries are generally available to the individual requestor. That process will remain available alongside the advisory opinion program, as will the bureau’s other efforts to provide clear guidance to the public.”
More information is available in the CFPB’s announcement.