The Consumer Financial Protection Bureau published a proposed rule focusing on any non-banks last month and is seeking public comment.
The proposed rule would establish and maintain a registry to collect information about certain public agency and court orders and facilitate the Bureau’s supervision of certain companies.
Furthermore, the proposed rule would require certain nonbank covered person entities (with exclusions for insured depository institutions, insured credit unions, related persons, states, certain other entities and natural persons) to register with the Bureau upon becoming subject to a public written order or judgment imposing obligations based on violations of certain consumer protection laws. Nonbanks subject to CFPB supervisory jurisdiction, including those operating in payday lending, private student loan origination, and mortgage lending and servicing would be subject to this proposed rule. Larger participants operating in student loan servicing, automobile financing, consumer reporting, consumer debt collection and international remittances would also be subject to the rule.
Those entities would be required to register in a system established by the Bureau, provide basic identifying information about the company and the order (including a copy of the order), and periodically update the registry to ensure its continued accuracy and completeness.
“Some companies seek to censor their customers and strip them of their rights by inserting fine print into non-negotiable contracts,” said CFPB Director Rohit Chopra in a press release. “The CFPB is proposing a registry of these contract clauses to find out where people are unable to speak up when they’ve been harmed.”
NIADA is working with other associations on an engagement strategy for this issue.
The comment period is open until April 3 and may be submitted at www.regulations.gov/commenton/CFPB-2023-0002-0001.