CFPB Rescinds Abusiveness Policy Statement To Help Protect Consumers – NMP Skip to main content

CFPB Rescinds Abusiveness Policy Statement To Help Protect Consumers

Mar 15, 2021
CFPB Logo
Director of Events

Then Consumer Financial Protection Bureau is rescinding its Jan. 24, 2020 policy statement, "Statement of Policy Regarding Prohibition on Abusive Acts or Practices." The CFPB plans to exercise supervisory and enforcement authority with the full scope of its statutory authority under the Dodd-Frank Act, as established by Congress, according to a press release.

The bureau made these changes in order to better protect consumers and the marketplace from abusive acts or practices. The CFPB is also looking to enforce the law as it was written by Congress. According to the CFPB, the Dodd-Frank Act prohibits companies from materially interfering with someone's ability to under a product or service, taking unreasonable advantage of someone's lack of understanding, taking unreasonable advantage of someone who cannot protect themself and taking unreasonable advantage of someone who reasonably relies on a company to act in their interests.

"The 2020 Policy Statement was inconsistent with the Bureau’s duty to enforce Congress’s standard and rescinding it will better serve the CFPB’s objective to protect consumers from abusive practices," according to the release.

The 2020 Policy Statement stated that the CFPB would decline to seek civil money penalties and disgorgement for certain abusive acts or practices. The CFPB deters abusive practices and compensates certain harmed consumers using penalties, so the Policy Statement undermined deterrence and was contrary to the CFPB’s mission of protecting consumers.

Click here to read more about the CFPB's plans moving forward.

About the author
Director of Events
Navi Persaud is Director of Events at NMP.
Published
Mar 15, 2021
Servicers Begin Testing Systems Ahead of VA Partial Claim Deadline

VA lenders and servicers have until Nov. 28 to implement the new loss mitigation waterfall and Partial Claim Program

ROAD Act’s Housing Incentive May Be Too Small To Move Supply

Realtor.com finds the median city risks losing only about $84,000, although the policy could carry more weight in supply-starved Northeast and Midwest markets

CRA Proposal Could Reshape Bank Lending And Affordable Housing Investment

The OCC and FDIC would put more weight on lending while easing community development requirements for hundreds of banks

Fannie Mae AI Governance Deadline Arrives Aug. 6

Seller/servicers using artificial intelligence in origination or servicing must have formal policies, oversight, and vendor controls in place

Condo Review Deadline Puts Lenders On The Clock

Fannie Mae and Freddie Mac will eliminate abbreviated project reviews for condo applications dated on or after Aug. 3

TRUE Releases AI Governance Guide Ahead Of Fannie Mae Deadline

Guide focuses on tracing mortgage data from borrower documents through AI validation, human review, and final LOS entry