The Consumer Financial Protection Bureau has released its plan to provide individuals and firms under investigation advance notice of possible enforcement actions.
The process, called the Early Warning Notice, allows the subject of an investigation by the bureau to react to potential legal violations that the bureau believes have been committed.
“The Early Warning Notice announced today strikes a balance between the goal of fairness to those being investigated and our mission to protect consumers,” Raj Date, the special advisor to the Secretary of the Treasury for the CFPB, said. “This process will help us fulfill our commitment to transparency in enforcing the law.”
The process is based on similar procedures that are used at other federal agencies. The Office of Enforcement begins the process by explaining to people or firms that the CFPB has gathered evidence against them that may prove violations against consumer financial protection laws. Any one or any firm that receives an Early Warning Notice is then allowed to respond within 14 days with legal arguments and facts.
The CFPB’s Office of Enforcement has already released a description for how it will initiate and execute enforcement investigations. Although the Early Warning Notice is not legally required, the bureau said it will help promote a fair enforcement of financial laws.