Compliance Blog

CFPB Issues Semi-Annual Report to Congress

It’s officially spooky season!  It gets dark earlier in the day, the moon was full last night, scary movies are all the rage, and all sorts of creepy crawly costumed creatures will soon be converging on our neighborhoods, asking for treats.

Three carved Halloween jack-o-lanterns sitting in a row, on a smoky-orange background, the middle pumpkin says "Trick or Treat"

On October 8, 2021, the CFPB got in on the pre-Halloween fun by publishing its spring 2021 Semi-Annual Report to Congress.  The CFPB is a very active agency, so its report clocks in at just over 100 pages, and is chock-full of the bureau’s activities during the reporting period (January – June 2021), under Acting Director Uejio.  The report summarizes the bureau's activities across many topics and initiatives, including COVID-19 effects, significant rules and orders adopted and planned for the upcoming period, complaint data analysis, supervisory and enforcement actions, fair lending efforts, and more.

Section 1.1 of the report kicks off with a piece on the effects of the COVID-19 pandemic on consumer credit, and notes that the bureau has published multiple blogs on the subject.  A December 2020 blog concluded that consumer credit markets at that time were “far from normal” based on the low number of applications and reported credit pulls.  The report also calls out another bureau publication from March 2021, entitled “Housing Insecurities and the COVID-19 Pandemic.”  This publication addressed data and research around the pandemic’s impact on the rental and mortgage markets, with a focus on the impact to low income and minority households, and found that “2.1 million families were behind at least three months on mortgage payments, while 8.8 million were behind on rent.”

Section 1.2 discusses the results from the bureau’s most recent Making Ends Meet Survey, to gain an understanding of consumers’ financial shortfalls, and how they handle them.  The survey was reported in July 2020, prior to the pandemic, and “helped to develop an understanding of how well-prepared households are for negative shocks such as job loss.”  Another December 2020 blog was published, which addressed consumers utilizing credit cards during the pandemic.  The blog showed that credit card debt fell across the board, even for financially vulnerable consumers.

Section 3.1 provides a list of the significant rules and orders adopted by the CFPB, which include:

·         Final Rule: Home Mortgage Disclosure (Regulation C)–2020 Final Rule

·         Final Rule: Home Mortgage Disclosure (Regulation C)–2020 Final Rule

·         Final Rule: Payday, Vehicle Title, and Certain High-Cost Installment Loans–Revocation Rule

·         Final Rule: QM Definition under the Truth and Lending Act (Regulation Z) Extension of the Sunset Date

·         Final Rule: QM Definition under Truth in Lending Act (Regulation Z): General QM Loan Definition

·         Final Rule: QM Definition under Truth in Lending Act (Regulation Z): Seasoned QM Loan Definition

·         Final Rule: Higher-Priced Mortgage Loan Escrow Exemption (Regulation Z)

Section 3.3 provides a list of significant initiatives the bureau has been focusing on, most of which are related to the COVID-19 pandemic, and the financial industry’s response.  The report notes that the CFPB has issued guidance documents regarding compliance in light of the CARES Act, and other impacted regulations and statutes.  In addition to its initiatives and resources for financial institutions and other supervised entities, the bureau also puts out quite a bit of information and resources targeted directly to consumers, including various consumer guides, educational activities and resources, and podcasts.

Section 3.4 outlines the bureau’s plan for upcoming initiatives, which include the annual Office of Servicemember Affairs Report, Older Americans Month and World Elder Abuse Awareness Day, an appraisal bias event, numerous research reports, outreach, and a continued focus on the COVID-19 pandemic response, among others.  Section 3.5 references the Spring 2021 Rulemaking Agenda, which also includes long-term actions that the CFPB is planning for.

Section 4 provides a brief analysis of complaints received by the bureau from April 1, 2020, through March 31, 2021.  It received over 650,000 complaints in that timeframe, which is about a 41% increase from the previous reporting period.  The majority of the complaints were about credit or consumer reporting (63%), then debt collection (14%) and credit cards (6%).  The CFPB issued its 2020 Annual Complaint Report in March of 2021, which we blogged about here.

Section 5 is a listing of supervisory and enforcement activities which the CFPB was a party to, including a brief statement of the issues of each.  This may be a helpful section to review, as it aggregates many recent actions that could be of interest to credit unions.

Section 8 goes into the bureau’s efforts for fulfilling its fair lending mission, which includes fair lending supervision, enforcement, outreach, and coordination with the other agencies which make up the Interagency Task Force on Fair Lending.

This is just a taste of what the bureau has been up to, so check out the full report for all of the ~gory~ details.

About the Author

Rebecca Tetreau, Regulatory Compliance Counsel, NAFCU

Rebecca-Harris---NAFCU-Regulatory-Compliance-Counsel

Rebecca Tetreau joined NAFCU as regulatory compliance counsel in February 2021.  In this role, Rebecca helps credit unions with a variety of federal regulatory compliance issues.

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