Predicted CFPB Changes Under the Biden Administration
As the new Biden Administration revisits the actions taken by Obama and Trump in the Bureau, how will these reflections impact the future of financial institutions? All signs point back to a consumer-focused agency. In an article published by the American Bar Association, the predicted changes under the Biden Administration were discussed. The volume of enforcement investigations and settlements will likely increase along with returning to a more aggressive legal theory of liability, impacting issuers and financial institutions. There will be more frequent and more significant penalties and restitution to those who fail to uphold the law. Finally, a shift back to resolving claims through enforcement channels in lieu of the supervisory process. It has been suggested that financial services companies reflect on the current strength of their compliance and with third parties following the change of administration.
Acting Director Dave Uejio released a statement noting his priorities are providing “relief for consumers facing hardships due to COVID-19 and the related economic crisis.” In a May 2021 Press Release, Director Uejio addressed the actions taken thus far,
- Rescinding policy statements made by the Trump Administration and made clear the full scope of the Bureau’s supervisory and enforcement authority would be employed under the Dodd-Frank Act,
- Inducted a new rule requiring debt collectors to provide written notice to tenants of their rights under the CDC eviction moratorium, and
- Delayed the compliance date for the final Qualified Mortgage rule to avoid any disruption to the housing market and ensure borrowers have access to responsible home loans during this critical time.
While some changes have been implemented to return to a consumer-based approach, predictions of what is to come and how issuers will respond remain.