The CFPB is proposing revisions to its 2016 no-action letter (“NAL”) policy and is planning to establish “BCFP Product Sandbox,” a regulatory sandbox that would encourage financial institutions to explore innovative products. The revamped policy would address the shortcomings in the 2016 version and streamline the application submission and review process, thus providing banks with increased incentives to seek NALs. Specifically, the revised policy proposes the following key changes: Including language in NALs that the…

We expect the U.S. Senate to confirm, as soon as this afternoon, President Trump’s nominee to lead the CFPB as its Director, Kathy Kraninger. A positive, though razor-thin and highly contested, outcome for Kraninger appears inevitable based on the Senate’s vote just a few days ago, strictly along party lines, to invoke “cloture” on the nomination by a margin of 50-49 (with one Republican absent), thereby prohibiting a Democratic filibuster on the confirmation. If Kraninger…

A recent FDIC request for information (RFI) suggests the FDIC is interested in enabling banks to offer small, short-term loans to consumers. Over the coming weeks the FDIC will be taking comments on the matter. After analyzing the comments received, the FDIC may issue guidance or regulations encouraging banks to offer these products. FDIC data suggests that 13% of U.S. households have unmet demand for small loans from banks, representing 14.8 million potential financial consumers.…

This Post is a “Part II” to our recent blog post describing the CFPB’s current plans to consider new rules that may narrow lenders’ exposure to “disparate-impact” liability under the Equal Credit Opportunity Act (“ECOA”), as well as other federal developments along the same lines, particularly with respect to auto lending. Today, we report on important countervailing developments at the state level, which indicate a more aggressive fair lending enforcement posture. Particularly because state laws…

On November 13, 2018, the Supreme Court agreed to review the Fourth Circuit’s decision in Carlton & Harris Chiropractic, Inc. v. PDR Network, LLC, 883 F.3d 459, 462 (4th Cir. 2018), addressing whether the Hobbs Act requires district courts to accept the Federal Communication Commission’s interpretation of the Telephone Consumer Protection Act. The case could affect the judiciary’s power to interpret agency rules. A split Fourth Circuit panel held that the Hobbs Act, 28 U.S.C.…

In its recently published Fall 2018 Rulemaking Agenda, the Bureau of Consumer Financial Protection announced that it is considering future rulemaking activity regarding the requirements of the Equal Credit Opportunity Act (“ECOA”) – specifically, “concerning the disparate impact doctrine in light of recent Supreme Court case law and the Congressional disapproval of a prior Bureau bulletin concerning indirect auto lender compliance with ECOA and its implementing regulations.” In May, President Trump signed a joint …