Compliance Forum Members Have Productive Call with CFPB

October 30, 2021, marks the one-year anniversary of the release of the CFPB’s final debt collection rules. NCBA remains proud that we were successful in our advocacy for the independence of the practice of law, which resulted in the CFPB’s removal of the troubling meaningful attorney involvement safe harbor provision. Since then, as the rules have been dissected and digested, NCBA members and our industry have had more questions at times than answers.

As part of our efforts to obtain guidance on the debt collection rules, NCBA established an Advisory Opinion Program (AOP) Task Force and on June 10, 2021 submitted a request to the CFPB seeking an advisory opinion, per member request.

More recently, five members of NCBA's Compliance Peer Forum, from varying size law firms, had a productive call with CFPB staff (three from Markets and one from Regulatory Implementation Guidance). The CFPB requested the call to hear the challenges and pain-points our members are experiencing in the implementation process.

The Compliance Peer Forum helped shape the feedback we conveyed to the CFPB. The main points included questions surrounding:

• Model Validation Notice (MVN)
• Voice Communications
• Digital Communications
• Staff Training and Assessments

During this meeting CFPB staff demonstrated their interest in hearing the industry’s implementation challenges and mentioned that the Bureau intends to release additional  FAQs to address industry questions.  

Our Fall Conference included an informative session called “The CFPB and State AGs: Enhanced Compliance or Enhanced Enforcement?” The session featured an all-star lineup, featuring Principal Assistant Director John McNamara, CFPB Office of Consumer Credit, Payments & Deposit Markets, Division of Research, Markets & Regulations along with Senior Assistant Attorney General D. Esther Chavez, Office of the Texas Attorney General, Consumer Protection Division and was moderated by attorney Manuel H. Newburger of Barron & Newburger, P.C.

The presentation placed special attention on the emerging relationship the CFPB has with various State AG’s offices covering compliance, regulation, and enforcement of consumer financial issues. These issues included the regulation of the Consumer Financial Protection Act, the CFPB’s implementation of Reg. F, and other related federal consumer and debt collection financial laws.

Session take aways:

• State AGs and the CFPB see each other as “extended family”. When faced with evidence of wrongdoing, members of this regulatory family work cooperatively and pool investigatory and enforcement resources.
• State AGs have worked collaboratively with FTC for over 100 years and CFPB for past 10 years. State and Federal agencies see collaboration as a strength and work together to ensure there is "no daylight" between the regulators and the "cops on the beat" enforcing the regulations.
• Many Federal and State investigations begin with former employees, whistle-blowers, or BBB complaints.
• Industry should expect changes with the new CFPB Director. Top priorities of new Director include COVID-19 recovery and DEI issues. The uneven US household recovery and financial stability is also a major concern.

We are grateful to have a close working relationship with Federal and State regulators.  Regulators have demonstrated that their interest in hearing from our members is as important to them as our interest in obtaining their guidance. As was noted at this session, "educating responsible industry is a form of consumer protection".

So, as we acknowledge the one-year anniversary of the release of the Debt Collection Rules, with the correct relationships, education, and guidance, it looks like Halloween may ultimately be scarier than Reg. F.

To support NCBA’s advocacy, please consider contributions to the NCBA PAC and/or Advocacy Support Fund.

Questions? Please contact nathan@creditorsbar.org.