Off the Record, On the Issues with John

​CFPB delays 1071 rule compliance, FOMC holds rates, and regulators seek input on payments fraud prevention.

By John Alexander, DakCU Director of Legislative & Regulatory Affairs

CFPB Keeps Its Enforcement and Supervision Resources Focused on Pressing Threats to Consumers
The Consumer Financial Protection Bureau is announcing today that, with respect to the regulation titled Small Business Lending Under the Equal Credit Opportunity Act (Regulation B), implementing Section 1071 of the Dodd-Frank Wall Street Reform and Consumer Protection Act, 88 Fed. Reg. 35,150 (May 31, 2023), it will not prioritize enforcement or supervision actions with regard to entities that are currently outside the stay imposed under Texas Bankers Association v. CFPB, No. 24-40705 (CA5). The Bureau will instead keep its enforcement and supervision resources focused on pressing threats to consumers, particularly servicemen and veterans. The Bureau takes this step in the interest of focusing resources on supporting hard-working American taxpayers, servicemen, veterans, and small businesses. Even absent resource constraints, the Bureau would deprioritize enforcement of this rule because of the unfairness of enforcing it against entities not protected by the court’s stay but similarly situated to parties that are protected by the stay. The Bureau looks forward to resolving the status of this regulation and ensuring fair, consistent treatment for all entities impacted by the regulation.

The CFPB has pushed back all three compliance deadlines for its Section 1071 rule, which requires lenders to collect and report detailed data on their small-business loans. The delay came in an interim final rule released this week.

The compliance dates are adjusted as follows:

• For high volume lenders, the compliance date is July 1, 2026, with the first filing date June 1, 2027;
• For moderate volume lenders, the compliance date is January 1, 2027, with the first filing date June 1, 2028; and
• For small volume lenders, the new compliance date is October 1, 2027, with the first filing date June 1, 2028.

FOMC leaves interest rates unchanged
The Federal Open Market Committee (FOMC) left interest rates unchanged at its meeting Wednesday. Federal Reserve Chair Jerome Powell said recent indicators suggest economic activity has continued to expand at a solid pace. The unemployment rate remains low, and labor market conditions remain solid while inflation remains somewhat elevated.

Federal financial regulators seek input on mitigating payments fraud
The Office of the Comptroller of the Currency (OCC), Treasury; the Board of Governors of the Federal Reserve System (Board); and the Federal Deposit Insurance Corporation (FDIC) seek public input on questions related to payments fraud. This request for information (RFI) offers the opportunity for interested stakeholders to identify ways that the OCC, the Federal Reserve System (FRS), and the FDIC could take actions collectively or independently in their varying respective roles to help consumers, businesses, and financial institutions mitigate check, automated clearing house (ACH), wire, and instant payments fraud.

The RFI contains questions covering five potential areas of improvement and collaboration to help mitigate payments fraud, including:

• External collaboration;
• Consumer, business, and industry education;
• Regulation and supervision;
• Payments fraud data collection and information sharing; and
• Reserve Banks’ operator tools and services. 

​Comments are also open for more general perspectives related to payments fraud and are due within 90 days of publication in the Federal Register. 

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For more information or to share your perspectives, feel free to contact me.