Small-biz data rule proposal expected in September, CFPB says in latest reg agenda

A notice of proposed rulemaking on financial institutions’ collection, reporting, and public disclosure of data concerning credit applications made by women-owned, minority-owned, and small businesses is among the regulatory actions anticipated by the Consumer Financial Protection Bureau (CFPB) in the months ahead.

This proposal and others to come are reviewed in a blog post by a bureau staffer Friday on the agency’s spring 2021 regulatory agenda, which is part of the “unified agenda” of rules across federal agencies and departments.

The small-business data proposal is planned for release in September, according to the agenda, and follows the outline of proposals issued last September and a stakeholder panel report in December. The proposed rule would implement a section 1071 requirement in the Dodd-Frank Act requirement.

Friday’s blog post reviews a handful of regulatory actions taken since the fall 2020 agenda came out and under the interim leadership of Acting Director Dave Uejio. It also hints at the expectation that a permament director (Rohit Chopra, currently on of the Federal Trade Commission, was nominated by President Joe Biden in January to succeed former Director Kathleen Kraninger) will be named in the coming months, noting that the permanent director’s changes to the current agenda will be reflected in the fall 2021 agenda.

The blog post and agenda shows that in addition to issuance of a small-business data collection proposal, the spring agenda also anticipates action on the following:

  • Availability of electronic consumer financial account data: Also referred to as “consumer access to financial records,” this rulemaking would implement section 1033 of the Dodd-Frank Act to address the availability of consumer financial account data in electronic form. An advance notice of proposed rulemaking was issued in November. The bureau is considering comments received and assessing “potential next steps.”
  • Property Assessed Clean Energy (PACE) financing: An advance notice of proposed rulemaking was issued in March 2019; the bureau said it is “continuing to engage with stakeholders and collect information for the rulemaking, including by collecting quantitative data on the effect of PACE on consumers’ financial outcomes.”
  • Standards for automated valuation models (AVMs): The bureau is pursuing an interagency rulemaking with the Federal Reserve Board, the Office of the Comptroller of the Currency (OCC), the Federal Deposit Insurance Corp. (FDIC), the National Credit Union Administration (NCUA), and the Federal Housing Finance Agency (FHFA) to develop regulations for quality control standards for automated valuation models (AVMs). (Such standards are called for under Dodd-Frank Act amendments to the Financial Institutions Reform, Recovery, and Enforcement Act [FIRREA] concerning real estate appraisals.) The spring agenda shows action possible by December.
  • Facilitating transition away from LIBOR index: The bureau said it anticipates having a final rule out in January 2022. The rule would address the anticipated expiration of the LIBOR (London Interbank Offered Rate) index, which the UK Financial Conduct Authority has stated that it cannot guarantee the publication of beyond June 2023. “Our work is designed to lessen the financial impact to consumers and facilitate creditor compliance by providing examples of replacement indices that meet Regulation Z requirements,” the bureau wrote Friday.
  • Reviewing existing regulations: The bureau plans a Dodd-Frank Act section 1022(d) assessment of a rule implementing the Home Mortgage Disclosure Act (HMDA), most of which became effective in January 2018. (The bureau noted that in light of other rulemaking priorities, it is no longer pursuing two HMDA rulemakings that were listed in the proposed rule stage in previous agendas – one addressing the data points that lenders must report and another related to the public disclosure of HMDA data.) The bureau also plans to publish results of a Regulatory Flexibility Act section 610 review of Regulation Z rules under the Credit Card Accountability, Responsibility, and Disclosure Act (CARD Act) that was initiated last August and completed in April.

Additionally, the bureau said it is also, as required by the Dodd-Frank Act, “continuing to monitor markets for consumer financial products and services to identify risks to consumers and the proper functioning of such markets.”

CFPB blog post: Spring 2021 Rulemaking Agenda

Unified Agenda – CFPB spring 2021 list