The Consumer Financial Protection Bureau (“CFPB”) published its fifth Fair Lending Report. The CFPB highlighted its efforts to protect consumers from market abuses, as well as its remediation results and priorities for 2017.
The report identified a number of approaches and outcomes related to the CFPB’s 2016 fair lending initiatives, including:
- risk-based prioritization in supervisory and enforcement work,
- results from enforcement actions, which produced $46 million for consumers,
- an update on Regulation C (“Home Mortgage Disclosure”) and the CFPB’s dialogue with the industry regarding compliance,
- interagency efforts to ensure the active supervision and enforcement of the fair lending laws and regulations, and
- CFPB outreach initiatives to reach stakeholders about issues concerning access to credit.
CFPB Director Richard Cordray said that the three goals of the Bureau in this area are to “strengthen industry compliance programs, root out illegal activity, and ensure that harmed consumers are remediated.” He praised the CFPB’s “significant efforts,” and added that the Bureau had reached an “historic resolution” of large cases involving redlining, auto finance and credit card fair lending.
CFPB Office of Fair Lending and Equal Opportunity Director Patrice Alexander Ficklin reported that in 2017, the Office will strengthen its focus on redlining and mortgage, student loan servicing, and small business lending.
Lofchie Comment: Given that many of the CFPB’s actions do not reflect current executive or legislative policy, the CFPB’s report on the direction of its intended activities brings home a difficult Constitutional issue: to what branch of the government does the CFPB belong? It is not judicial. It is not funded directly by Congress. And it does not report to the President. It is clearly more “independent” than the other independent agencies, such as the SEC or the CFTC (whose Chairpersons are named by the President), but its extreme independence forces the question of where independent agencies (including even the SEC and the CFTC) fit generally within the Constitutional scheme of a tripartite government.