What happens if the CFPB couldn't issue rules?

Posted on 12/03/2015 at 01:46 PM by John Lande

This is the third in a three-part series on the CFPB. This blog recently covered the ongoing challenge to the existence of the CFPB. One issue of particular interest is what happens to CFPB rules issued from January 4, 2012, to July 16, 2013, if the courts rule that the CFPB did not have authority to issues rules during that period. The reason this may happen, as explained by this blog, is that from January 4, 2012, to July 16, 2013, the CFPB's director, Richard Cordray, was not the legal head of the CFPB until he was confirmed by the United States Senate. Below is a list of rules the CFPB issued during that time period that, if State National Bank of Big Spring (Bank) is right, might be invalid:

  • Home Mortgage Disclosures, Regulation C (February 2012)
  • Fair Credit Reporting Act Disclosures (April 2012)
  • Equal Access to Justice Implementation Rule (June 2012)
  • Rules for Adjudication Proceedings (June 2012)
  • Rules Related to CFPB Investigations (June 2012)
  • Defining Large Participants in of the Consumer Reporting Marketing (July 2012)
  • Amendments to Regulation W (November 2012)
  • Regulation Z HOEPA (November 2012)
  • Regulation Z Exemption Threshold Amount (November 2012)
  • Regulation M Exemption Threshold Amount (November 2012)
  • Delayed implementation of new mortgage disclosures (November 2012)
  • Home Mortgage Disclosure Adjustment to Asset-Size Exemption Threshold, Regulation C (December 2012)
  • Defining Large Participants in Consumer Debt Collection Market (December 2012)
  • RESPA Final Rules, Regulation X (January 2013)
  • TILA Final Rules, Regulation Z (January 2013)
  • Disclosure of Appraisals under ECOA, Regulation B (January 2013)
  • Loan Originator Compensation, Regulation Z (January 2013)
  • Amendments to Disclosures at ATMS, Regulation E (March 2013)
  • TILA Final Rule Amendments, Regulation Z (March 2013)
  • Civil Penalty Fund Rules (April 2013)
  • Remittance Transfer Final Rule, Regulation E (April 2013)
  • Amendments to Escrow Final Rules, Regulation Z (May 2013)
  • Ability to Repay and Qualified Mortgage Rules, Regulation Z (May 2013)
  • Loan Originator Compensation Final Rules, Regulation Z (May 2013)
  • Procedure for Establishing Authority over Nonbanks (June 2013)
  • Amendments to 2013 Mortgage Rules under RESPA (July 10, 2013)
  • Procedures for Collection of Debts Owed to United States (July 11, 2013)

These are just some of the rules and procedures that may be invalid if the district court agrees with the Bank that the CFPB did not have authority to issue rules while Mr. Cordray was not confirmed by the Senate. Such a ruling could have a significant impact on financial institutions' compliance obligations, so this blog will continue to monitor the progress of the case. T

he material in this blog is not intended, nor should it be construed or relied upon, as legal advice. Please consult with an attorney if specific legal information is needed.

- John Lande

Categories: John Lande, Banking Law


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