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New rules governing the CFPB’s enforcement work

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Today, the CFPB is posting three final rules and one interim final rule that we have sent to the Federal Register for publication. The rules deal with our procedures and practices related to enforcing federal consumer financial law. These rules allow the agency to stay abreast of developments in consumer financial law, investigate possible violations of these laws, and bring actions to enforce these laws, helping us better serve our mission of protecting American consumers.

The three final rules deal with the agency’s investigative and adjudicative processes and our interactions with state law enforcement authorities. We published interim versions of these rules in July of 2011. During an extensive comment period that followed, we received and evaluated public input on the interim rules, and we have made certain changes to improve and clarify the rules.

Rule Relating to Investigations: This rule describes the CFPB’s procedures for investigating whether persons have engaged in conduct that violates federal consumer financial law. Similar to rules used by other regulators, it lays out an efficient and fair process for conducting CFPB investigations. This rule sets forth our authority to conduct investigations, including the procedures for issuing civil investigative demands. It also describes the rights of persons from whom the CFPB seeks to compel information in investigations.

Rule of Practice for Adjudication Proceedings: Under this rule, the CFPB can conduct administrative adjudications (hearings) to ensure or enforce compliance with federal laws and regulations. In developing this rule, we leveraged the experiences of other regulators and reviewed the public comments on the interim rule to create a fair and expeditious process for resolving administrative enforcement actions. The result is an adjudication process that is streamlined and protects parties’ rights to fair and impartial proceedings.

State Official Notification Rule: This rule is designed to help the CFPB stay informed about state-level legal developments relating to the Dodd-Frank Act. It describes the process through which state officials update the agency on certain legal actions they bring to enforce compliance with certain provisions of the Dodd-Frank Act and regulations the CFPB may issue. Proper notification will help ensure that the law is being enforced in a consistent manner.

The last rule is an interim final rule that implements the Equal Access to Justice Act (EAJA). We are now asking for public input on this interim final rule.

EAJA Implementation Rule: This rule implements the Equal Access to Justice Act. The Act provides that certain prevailing parties in administrative proceedings can recover attorney fees and expenses. The rule sets forth who can seek to recover these costs and how to do so. It is based on model rules and rules used by other agencies. The public can comment on the interim final rule for 60 days after its publication in the Federal Register.

These rules will be published in the Federal Register in the near future and will be effective immediately upon publication. The versions linked in this post contain the text as we submitted them.

Ori Lev is the CFPB’s Deputy Enforcement Director for Litigation.

  • Lisahenrn

    Our complaint was filed in January, I can only hope and pray it is the examination process.  I am praying the bank is held accountable for not complying with the law.

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    This website has very valuable info on it. I hope other websites spend sometimes to improve themselves just like this one.

  • Anonymous

    Focusing on common abusive practices would be ideal for this agency, and to prevent duplication, but not duplicious oversight as provided by the DOJ, FTC, and FINRA, or SEC.  Single complaints are far more apt to be submerged under the pile than addressing numerosity in similarity of complaint that continues to afflict the general public.

    Such matters as abusive or deceptive fees on credit or debit cards, or bank accounts, or such matters as rubber stamped, often deceptive default proceedings (which then aim to use the default to up the chargeable interest ante to maximize profits for creditors), or simply using deception, no notification, or abusive discretion to compound the harm to create the perception that firms are in the right when they are in the wrong. These kinds of undue influence, and unjust enrichment schemes dot the landscape of financial services through which many individual consumers are harmed, often without recourse because of the way laws are lobbied to be written, and railroaded through the legislatures. Heck, they even influence Congressional laws.

    Americans want fair trade, fair deals, and fair business attitudes, but they are getting anything but, and are often subject to the perverse abuse of attorneys using judicial immunity to snowplow their way through legal proceedings, or to intimidate consumers who have no resources or avenues to help themselves. Business and financial railroading is the manner of business today with consumers, and most hate it. No golden rule here!

  • Ftl0123

    I would hope that the CFPB would make information regarding the consumers case more readily accessible to them, instead of having to wait for long periods of time and being told that something is just in investigation.  It would be nice to know what is being done on their behalf.

  • Jason

    There are so many people who were hit by the 2007-2008 crisis. One of the biggest issues is not the Banking industry, it is the Credit Bureaus and Collection Agencies.  The violations of the Fair Credit Reporting Act and the Fair Debt Collection Pracitices Act are astonomical and with all the errors, it is no wonder why no consumers can get qualified for a home loan or are forced to pay 20%+ interest on a car loan.  This is where the CFPB can be extremely effective.  Yes, the big 3 Credit Bureaus, Experian, Equifax and Trans Union want to stay under the limelight and have very powerful Lobbyists but they are also failing to Accurately report data.  Yes, it is their job to ensure that anything they report under a person is 100% Accurate.  It is their job to investigate and not take 20 pages of documents sent in by a consumer and shrink it down to a 3 digit code that is sent over to the Creditor or Collection Agency.  It is wrong for Collection Agencies to file “Robo-Judgments” on consumers when they do not even have a copy of an Original Contract.  It is illegal for them to play the Shell Game by reporting a collection on a person’s account (usually without sending the required notice, per FDCPA) and then using another collection agency under the same Holding Company to also go after the consumer over the same Original Debt.
    The CFPB can create a huge increase in consumer lending activity if they would focus their efforts over the 3 big Credit Bureaus and the Major Collection Agencies.  Audit them, Supervise them; nobody had done that in the past and that is all because of money/power.  It is time to help the Average American and help ensure that if something, good or bad, is reporting on their credit, it should be 100% Accurate & 100% Validatable; not just verified by a simple spreadsheet without any Original Contract.

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    Thanks so much for the information!  Great resource.  Wish there were more websites like this one out there.

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