On March 26, the CFPB announced an easing of certain reporting requirements in order to allow financial services companies to focus on responding to consumers during the COVID-19 pandemic. The CFPB postponed several different reporting requirements relating to the Home Mortgage Disclosure Act (HMDA), credit cards, and prepaid accounts. In an unusual step for the bureau, the CFPB issued a policy stating that it “does not intend to cite in an examination or initiate an enforcement action” against any entity that fails to submit the otherwise-required data. Director Kathleen Kraninger noted that easing companies’ reporting burdens “supports consumers by allowing financial companies to focus their resources on assisting consumers.”
HMDA Reporting – The CFPB’s HMDA statement postponed the quarterly data reporting that would have been required by May 30, 2020, pursuant to HMDA and Regulation C. The CFPB stated that additional guidance will follow regarding when institutions must resume HMDA reporting and noted that entities must continue to collect the data for future submission.
Credit Cards and Prepaid Accounts – The CFPB issued a second statement relaxing reporting requirements for credit card and prepaid account issuers. Specifically, the CFPB temporarily suspended:
- Annual submission of certain information concerning agreements between credit card issuers and institutions of higher education (and certain affiliated organizations), as required by the Truth in Lending Act (TILA), 15 U.S.C. § 1637(r), and Regulation Z, 12 CFR 1026.57(d)(3);
- Quarterly submission of consumer credit card agreements, as required by TILA, 15 U.S.C. § 1632(d)(2), and Regulation Z, 12 CFR 1026.58(c);
- Collection of certain credit card price and availability information from a sample of credit card issuers under TILA, 15 USC §1646(b)(1) et seq.; and
- Submission of prepaid account agreements and related information required by Regulation E, 12 CFR 1005.19(b).
As with HMDA, the CFPB intends to issue additional guidance about when and how entities should submit this required information.
Postponement of Other Data Collection – The CFPB is also postponing two surveys: (1) a survey seeking compliance cost information in connection with the pending small business lending rulemaking under Section 1071 of the Dodd-Frank Act; and (2) a survey relating to Property Assessed Clean Energy (PACE) loans.
Finally, the CFPB issued an additional statement reiterating prior guidance that encourages companies to work constructively with customers affected by the pandemic. In addition, the bureau signaled flexibility in scheduling examinations and other supervisory activities in light of current disruptions. The CFPB made no specific pledges to refrain from supervisory or enforcement activity regarding industry responses to the crisis, but instead noted that it “will consider the circumstances that entities may face as a result of the COVID-19 pandemic and will be sensitive to good-faith efforts demonstrably designed to assist consumers.”
Regulated entities will undoubtedly welcome the CFPB’s temporary relaxing of administrative burdens, although institutions need to be prepared to report the information at a later date. Perhaps the most noteworthy aspect of the CFPB’s announcement is the explicit commitment not to cite in an exam or bring an enforcement matter against an entity that fails to report the otherwise-required data. Such commitments are rare from the CFPB, but they provide valuable assurance to the industry. As the industry continues to respond to the COVID-19 pandemic – including, for example, by providing government-encouraged or required consumer relief – additional CFPB commitments can be critical to ensuring that regulated entities provide relief to as many consumers as possible.