Cordray: Paper to come on indirect auto lending
June 23, 2014 – CFPB Director Richard Cordray last week alerted the House Financial Services Committee to a white paper, due out late this summer, on the methodology behind the bureau’s actions toward indirect auto lending.
Cordray noted the whitepaper during a hearing last week on the bureau’s semiannual report to Congress. During the hearing, he also reiterated the bureau’s plan to have a proposed rule out on prepaid cards by “end of summer.”
In March 2013, CFPB issued Bulletin 2013-02 on the potential for pricing disparities on the basis of race, national origin and possibly other prohibited factors by dealers that facilitate funding for consumers’ auto purchases through indirect lenders. It cautioned lenders that they may be liable under the legal doctrines of both disparate treatment and disparate impact if there are disparities within the indirect lender’s portfolio, the bulletin says – citing the Equal Credit Opportunity Act.
Under the 2010 Dodd-Frank Act, CFPB does not have regulatory oversight over auto dealers, but it can regulate indirect auto lenders – including credit unions. NAFCU lodged concerns about CFPB’s approach, as it appears to put credit unions between auto dealers and CFPB.
"Cordray: Prepaid card proposed rule late summer" 6/10/14