What to Expect from the Consumer Financial Protection Bureau this Year

Among the projected action areas: HMDA reporting, overdrafts, and prepaid cards.

March 1, 2014

Last year, the Consumer Financial Protection Bureau’s (CFPB) rulemaking focused primarily on remittance transfers and implementing the mortgage lending requirements the Dodd-Frank Act mandates.

Based on the agency’s semiannual rulemaking agenda, this is a snapshot of what to expect in months ahead:

HMDA reporting

The CFPB plans to work on a Regulation C proposal to implement Dodd-Frank Act changes to the Home Mortgage Disclosure Act (HMDA).

The statutory amendments expanded the scope of information relating to mortgage applications and loans that financial institutions must compile, maintain, and report under HMDA (e.g., ages of loan applicants/mortgagors, credit scores, points and fees payable at origination, value of collateral, introductory interest rates, etc.).

The CFPB will begin developing proposed regulations concerning the data and how to collect (the appropriate format, procedures, information safeguards, and privacy protections), compile, and report it under HMDA.

Overdrafts

In June 2013, the CFPB issued a white paper summarizing the agency’s initial findings from its analysis of overdraft practices.

The white paper, based on supervisory data from nine large banks, highlighted potential consumer protection concerns, including the way consumers opt-in to overdraft coverage for ATM and one-time debit card transactions, overdraft coverage limits, transaction posting order, overdraft and insufficient funds fee structure, and involuntary account closures.

The CFPB is considering whether rules governing overdraft and related services are warranted, and if so, what types of rules would be appropriate.

A possible rulemaking might include disclosures or address specific acts or practices.

Prepaid cards

The CFPB plans to move forward with a proposed rule to address general purpose reloadable (GPR) prepaid card products in late spring, following up on the Advance Notice of Proposed Rulemaking (ANPRM) issued in 2012.

GPR cards are increasing in popularity as some consumers now use them like a debit card that’s linked to a traditional checking account. The CFPB is reviewing the comments received in the ANPRM to determine what rule(s) might be appropriate. The agency also is also testing model consumer disclosures.

Other areas

The agency is assessing the need for regulations concerning debt collection, payday loans, and deposit advance products.

The CFPB is gathering information on these topics through previous white papers, research, requests for comment, and advance notices of proposed rulemaking (including a current request for comment on debt collection practices), and other forms of outreach.

The agency will continue work on these projects in 2014, including testing consumer disclosures related to prepaid products and debt collection.

Inherited regulations

The CFPB also plans to streamline and modernize the regulations it inherited from other agencies.

Specifically, the agency expects to issue a proposal regarding annual privacy notices (Regulation P). Industry feedback suggests it would be helpful to reduce unwanted paperwork for consumers and unnecessary regulatory burdens— at least in cases where a financial institution limits the sharing of information with third parties and whose policies have not changed.

Visit consumerfinance.gov for more information.