Inside CFPB Semi-annual Report: Final Rules Expected

This week Bank Risk and Compliance Writer has been analyzing the CFPB’s Semi-annual Report, which was published on April 2. Monday’s post discussed the CFPB Acting Director’s call for remodeling the Bureau, which includes changing how it is funded and its level of independence. Tuesday’s post covered the CFPB’s plans for upcoming proposed rules, which leads us to today’s post–Final Rules Expected from the CFPB.

Upcoming Final Rules Per CFPB’s Semi-Annual Report

According to its report, there are three proposed rules that the CFPB anticipates finalizing in the near term.

1. Proposed Rule to Amend the Gramm-Leach-Bliley Act (GLBA): This rule was originally proposed by the CFPB on July 1, 2016 to correspond to Congress’ amended changes to GLBA in connection with passage of Fixing America’s Surface Transportation Act (FAST Act) in December 2015. As proposed, it would mirror the FAST Act in exempting financial institutions meeting certain conditions from sending annual privacy notices to customers as per GLBA. Financial institutions “can use the annual notice exemption if it limits its sharing of customer information so that the customer does not have the right to opt out and has not changed its privacy notice from the one previously delivered to its customers.” When finalized, this should provide some compliance relief for institutions that meet the exempting criteria.
2. Amendments Relating to Disclosure of Records and Information: Originally published in the Federal Register on August 24, 2016, this rule was proposed by the CFPB to revise its original 2011 rule protecting the confidentiality and disclosure of information. The CFPB’s stated purpose for the revision was “to clarify, correct, and amend certain provisions based on its experience over the last several years.” As proposed, the rule would revise and/or clarify these items: 1) rule’s definitions; 2) practices related to the Freedom of Information Act; 3) procedures for requests for information; 4) protection and disclosure of confidential information generated or received by the CFPB in its work; and 5) the Chief Privacy Officer’s authority.
3. Amendment to the Federal Mortgage Disclosure Requirements under TILA (Reg Z): The CFPB published this proposed amending rule on August 11, 2017. According to the proposal’s summary, this rule relates “to when a creditor may compare charges paid by or imposed on a consumer to amounts disclosed on a Closing Disclosure, instead of a Loan Estimate, to determine if an estimated closing cost was disclosed in good faith.” It goes on to indicate, “Specifically, the proposed amendments would permit creditors to do so regardless of when the Closing Disclosure is provided relative to consummation.” In its comment letter of October 10, 2017 the American Bankers Association expressed its general support of the amendment relieving unintended consequences of the TILA-RESPA Rule. It also summarized its understanding of the amendment for further clarification.

Tomorrow, in the final post of this series, look for an analysis of recent CFPB enforcement actions outlined in the Semi-annual Report.