“This is an important step in the development of our non-bank supervision program,” CFPB Director Richard Cordray said. “This proposal allows us to reach non-banks that we would not otherwise supervise, while providing industry with a streamlined process that is fair and efficient.”
Non-bank companies include debt collectors, mortgage servicers, payday lenders, mortgage lenders, money services firms and consumer credit reporting agencies. Under the 2010 Dodd-Frank Act, the CFPB was granted the authority to oversee any non-bank entity that the watchdog agency deems risky to the American public.
The proposed rule would establish and clarify procedures to inform a non-bank company that it is being considered for increased oversight by the CFPB, including the information that would be required in the notice to and response by the non-bank firm. The proposal would further set out a procedure that would enable non-bank entities to file a petition to terminate oversight authority after two years.
If the agency does notify a non-bank company, it will mean that the agency may be supervising it. The CFPB does have the authority to conduct examinations of and request reports from those non-bank companies under supervision.
The rule proposal will be available for public comment for 60 days following its publication in the Federal Register.