The Consumer Financial Protection Bureau announced that it is planning to use its authority to begin supervising nonbank financial companies that "pose risks to consumers." The CFPB is invoking this authority, which has largely been unused, in order to "level the playing field between banks and nonbanks."
In connection with the announcement, the CFPB also announced that it is promulgating a new rule which will allow the agency to make public its findings related to its supervision of nonbanks.
In a statement, CFPB Director Rohit Chopra said, “Given the rapid growth of consumer offerings by nonbanks, the CFPB is now utilizing a dormant authority to hold nonbanks to the same standards that banks are held to. This authority gives us critical agility to move as quickly as the market, allowing us to conduct examinations of financial companies posing risks to consumers and stop harm before it spreads.”
The CFPB said that it intends to supervise a wide-range of nonbank companies, including companies in the mortgage, private student loan, and payday loan businesses, as well as other companies providing consumer financial products and services, including consumer reporting, debt collection, student loan servicing, international remittances, and auto loan servicing. The CFPB also intends to supervise other companies that "the CFPB has reasonable cause to determine pose risks to consumers." The CFRP explained that, "This will allow the CFPB to be agile and supervise entities that may be fast-growing or are in markets outside the existing nonbank supervision program."
"Given the rapid growth of consumer offerings by nonbanks, the CFPB is now utilizing a dormant authority to hold nonbanks to the same standards that banks are held to" -- Rohit Chopra, Director, CFPB