In its first 100 days, the Consumer Financial Protection Bureau has staffed up, studied up and started up a few key initiatives. Here are more details from the testimony of Raj Date in his remarks to the House Subcommittee on Financial Institutions and Consumer Credit on Nov. 2.
Staff: On the staffing front, the CFPB now has more than 700 employees, many of them from other federal regulatory agencies, according to Date, special advisor to the U.S. Treasury secretary, acting as interim head of the Bureau.
Industry interaction: Bureau staff members – operating from bases in Washington, D.C., Chicago and San Francisco – have met with consumers, consumer groups, civil rights organizations, big banks, community banks, investors, and trade organizations, both before and after officially opening on July 21, 2011. Most recently, the CFPB held a town hall meeting in Minneapolis to hear such testimony from members of the public.
Student lending: At another recent event in Minneapolis, Date and other CFPB staff announced a new student loan disclosure form. The Bureau is asking for feedback (through an online comment form) on this model disclosure.
In addition, the CFPB has named Rohit Chopra to the new position of private education loan ombudsman, required by the Dodd-Frank Act., required by the Dodd-Frank Act. The ombudsman will work with the Department of Education to receive, review, and attempt to resolve complaints from borrowers of private student loans. At the same time, the Student Debt Repayment Assistant tool launched online.
Large bank examination: The CFPB will examine the nation’s 111 largest banks, those with $10 billion or more in assets. In October, the Bureau released its first Supervision and Examination Manual for these banks. (Read more about the manual in this article by Frederikson & Byron attorney Karen Grandstand.)
Mortgage disclosure: To date, the CFPB has logged more than 22,000 comments on its proposed mortgage disclosure form, which combines both Truth in Lending and RESPA information, according to Date. Consumer testing on Round 4 of this proposed form is taking place in New Mexico – meanwhile, the public can comment on the two versions (one highlights a fixed-rate loan; the other an adjustable-rate loan) by sending an e-mail to CFPB_KnowBeforeYouOwe@consumerfinance.gov.
(As an aside, one mortgage industry trade group has pointed out that iPhones and tablets have already made one of the proposed forms obsolete.)
Regulatory review: The CFPB also has begun its review of regulations inherited from other agencies. “Changes in technology, market practices, and the legal landscape may have caused some of these rules to be obsolete, unnecessary, redundant, or counterproductive,” Date told members of Congress.
“Later this month, the Bureau will initiate a targeted review of these rules in search of ways to update and streamline the regulations. Consistent with the Bureau’s philosophy, we will ask the public to participate in this process from the beginning,” he said.
In the consumer education arena, the CFPB is ramping up its Office of Servicemember Affairs, led by Holly Petraeus. Among the Office’s goals are: to protect military families from predatory lending; to help them avoid foreclosure; to help them better understand military college benefits; to deal with auto lending issues; and to enforce fair lending and debt collection practices, as Petraeus describes on the CFPB blog.
The Office of Older Americans is off the ground too. Former Minnesota attorney general Skip Humphries will lead this effort.
“We are committed to basing our judgments on research and data analysis. We will not shoot from the hip. We will not reason from ideology. We will not press a political agenda,” Date said at the conclusion of his remarks.
One of the members of the subcommittee, Rep. Luis Gutierrez (D-Ill.), credited “Wall Street reform and the thinking behind the CFPB” for Bank of America’s reversal of its $5-a-month debit card fee.
Read Date’s full testimony.