CFPB Adopts Rule for Protection of Privileged Information

The Consumer Financial Protection Bureau (CFPB) last week adopted a rule to codify protections for privileged information submitted to the Bureau by the financial institutions it regulates.

“We are committed to safeguarding the confidential information of the institutions we supervise to ensure the Bureau is best equipped to do its job and protect consumers,” said CFPB Director Richard Cordray. “This new rule supports the free flow of information that is essential to an effective supervision program.”

In January 2012, the CFPB advised the institutions that it supervises that the submission of privileged information to the CFPB does not waive any applicable privilege with respect to third parties. The new rule provides supervised entities further assurances that providing privileged information to the Bureau will not adversely affect the confidentiality of such information. The new rule also makes clear that the CFPB’s transfer of privileged information to another Federal or State agency does not result in a waiver of any applicable privilege.

The Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act) provided the CFPB with the authority to issue rules necessary or appropriate to enable the Bureau to fulfill its obligations to protect consumers of financial products and services. The Dodd-Frank Act also specifically provided the Bureau with authority to issue rules regarding the confidential treatment of information obtained by the Bureau.

The Bureau released the proposed rule in March 2012. In issuing the final rule, the CFPB considered public comments that were received.

A copy of the final rule has been submitted to the Office of the Federal Register and is available at: http://files.consumerfinance.gov/f/201206_cfpb_final-rule_confidential-treatment-privileged-information.pdf