Hensarling presses CFPB for auto-lending data
March 11, 2014 – House Financial Services Committee Chairman Jeb Hensarling, R-Texas, told CFPB Director Richard Cordray that he has until Thursday to provide information to the committee on methods and analysis the bureau uses to determine if discrimination has taken place in the auto-lending market.
The Wall Street Journal reported that Hensarling sent a letter to Cordray last Friday requesting this information, which, he said in the letter, is the same information that the committee requested almost a year ago. Hensarling said if Cordray does not comply with the March 13 deadline, the committee will consider other action, such as a subpoena.
“By refusing to disclose this information, the bureau has deliberately deprived indirect auto lenders of any meaningful way to tailor their company’s lending practices and compliance systems so as to mitigate or eliminate the fair lending risk the bureau asserts to be present,” the letter said, quoted by the WSJ.
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 remains concerned about the CFPB’s approach with respect to indirect lending arrangements as the bureau’s guidance appears to put credit unions between auto dealers and CFPB.
Hensarling is requesting information including the method CFPB used to identify cases of discrimination in the Ally Financial Inc. case, which led to a $98 million settlement with the Department of Justice and the bureau in December over allegations of discrimination against minority borrowers.