CFPB Launches Pilot Advisory Opinion Program
The Consumer Financial Protection Bureau, June 18, 2020, has released a pilot AO program to issue clear guidance to regulated entities. The program allows entities to submit requests regarding uncertainties, and the Bureau will sort the requests based on the program’s priority. Prioritized requests will receive public responses. The AO program is another method for the Bureau to build on clarification and guidance efforts.
The pilot program focuses on four key priorities:
● Providing information to consumers in a timely and understandable manner to allow a responsible decision-making process
● Reduction of regulatory burdens through recognition of outdated, unnecessary or unduly burdensome regulations
● Enforcing Federal consumer financial law impartially in order to promote fair competition
● Ensuring transparent operations in consumer financial products and services markets
Factors weighed for appropriate AOs include:
● Bureau examinations have noted the interpretive issue for regulatory clarity
● The issue has substantial importance and clarification will result in significant benefit
● The Bureau has not previously addressed the ambiguity through interpretive rule or other source
The Bureau has noted that issues that regard ongoing investigation, enforcement action, or rulemaking will have a strong presumption against appropriateness of an AO. If deemed appropriate, the AO will be issued and publicly posted on the Bureau’s website and in the Federal Register in a manner that would be applicable to other entities with similar situations.
For more information, contact Troy Garris at 301-461-8952 or troy@garrishorn.com.
