CFPB In Action: A Roundup of Recent Activity

The biggest CFPB news of interest to the debt collection industry from the last two weeks includes a CFPB announcement that it plans to amass records on the financial behavior of more than 10 million Americans, and an address by Deputy Director Steve Antonakes to the American Bankers Association about rulemaking, supervision, and examination.

Consumer Records

As we’ve come to understand, the Bureau likes to gather lots of information so it can gain a holistic understanding of a market. The thought is – they don’t exactly know that they are looking for until they see enough data to be able to see broad patterns and connections.

According to this piece in Bloomberg, “The agency’s approach dovetails with a trend toward data analytics, often dubbed “Big Data,” by firms such as Amazon.com Inc., Google Inc., International Business Machines Corp. (IBM) and General Electric Co. Those companies are mining massive pools of information for insight into areas including consumer behavior, manufacturing, dairy farming and genetics.”

The topic of the CFPB’s excursion into Big Data was prominent this week in Congressional hearings. insideARM.com covered the Senate committee hearing on the CFPB’s semi-annual report to Congress where questions about the Bloomberg article took a good chunk of time.

Bloomberg’s piece on the report and hearing likewise noted the questions on data collection, following up on its original article. The CFPB also reported that it “In its first 21 months, the bureau has secured $425 million in relief for 6 million consumers wronged by financial service providers.”

The CFPB is obligated to testify to both chambers of Congress when it releases its semi-annual reports. While the Senate Banking Committee had pointed questions for Director Richard Cordray, the chairman of the House Financial Services Committee is refusing to hear testimony from Cordray, arguing his current appointment to the position is legally invalid, according to The Hill. So that’s one way to go.

Mortgage/Bank Activity

On April 17, CFPB Deputy Director Steve Antonakes addressed the American Bankers Association Government Relations Summit. He delivered prepared remarks that discuss the CFPB’s intentions related to implementing newly released mortgage industry rules. While these specific rules don’t directly affect third party collectors, his detailed discussion of the supervision process is instructive for those in the industry who are anticipating examination. They are worth reading.

Other Items of Note

New gig for Raj Date, former number two guy at the CFPB (left earlier this year). He is the Managing Partner of newly formed Fenway Summer LLC, an advisory firm that focuses exclusively on the U.S. consumer finance market. He leads Fenway Summer’s work across its three practice areas: advising large banks and finance companies on consumer finance strategy; evaluating private equity investments in whole-company and asset transactions; and incubating and launching new ventures.

Software for CFPB compliance: I also noted the first slew of technology companies releasing software products to assist specifically with the process of compliance with CFPB rules and examination criteria. Here are three announcements from the past two weeks (in this case, specifically for mortgage lenders, on the eve of the ABA Summit):

Clarifire

Coester

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