Recent actions by the Consumer Financial Protection Bureau (CFPB) indicate that it intends to break quickly from the starting gate on July 21, 2011, the date it becomes fully operational.

The CFPB announced on April 11, 2011, that it has agreed on a Joint Statement of Principles with the National Association of Attorneys General (NAAG) to govern their interactions in enforcing the Dodd-Frank Wall Street Reform and Consumer Protection Act and CFPB regulations. On April 5, 2011, a notice was published by the U.S. Department of the Treasury on behalf of the CFPB in the Federal Register. In the notice, the CFPB seeks comments on its plans for collecting data to assist it in developing model forms integrating the Truth in Lending Act (TILA) and Real Estate Settlement Procedures Act (RESPA) disclosures required for residential mortgage loans. The Dodd-Frank Act mandated that the CFPB develop the forms.

The Joint Statement was announced by Elizabeth Warren at a meeting of NAAG’s Presidential Initiative Working Group, held in Charlotte, North Carolina. In the Joint Statement, the parties agree to consult regularly in order to identify mutual enforcement priorities, share complaints, and support each other’s enforcement efforts, including through joint or coordinated investigations and coordinated enforcement actions.

In her remarks, Ms. Warren indicated that more than 50 percent of the CFPB budget would be dedicated to supervision and enforcement, which she described as the CFPB’s first priority. She also indicated that 25 percent of the budget would be dedicated to consumer education, outreach, and consumer complaint management, with the remainder going to such activities as rulemaking and market research. According to Ms. Warren, although the Dodd-Frank Act requires only that the CFPB establish a Consumer Advisory Board (and such action cannot precede the appointment of a CFPB Director), the CFPB will likely establish additional advisory boards.

The CFPB notice—describing how the CFPB intends to use data collection and qualitative testing to inform its development of integrated TILA/RESPA model forms—serves as the CFPB’s information collection submission to the Office of Management and Budget required by the Paperwork Reduction Act. The filing of the notice appears intended to enable the CFPB to promptly move forward on developing the forms once TILA and RESPA rulemaking authority is transferred to the CFPB on July 21, 2011. The CFPB’s plans include (1) conducting one-on-one interviews in English and Spanish and (2) testing the disclosures at six sites in five rounds. The CFPB solicits comments, which must be filed by May 5, 2011, on various issues relating to its proposed data collection.

Ballard Spahr’s Consumer Financial Services Group is nationally recognized for its guidance in structuring and documenting new consumer financial services products, its experience with the full range of federal and state consumer credit laws throughout the country, and its skill in litigation defense and avoidance (including pioneering work in pre-dispute arbitration programs).  For more information, please contact Group Chair Alan S. Kaplinsky, 215.864.8544 or; Vice Chair Jeremy T. Rosenblum, 215.864.8505 or; John L. Culhane, Jr., 215.864.8535 or; Keith R. Fisher, 202.661.2284 or; Barbara S. Mishkin, 215.864.8528 or; or Mark J. Furletti, 215.864.8138 or

Copyright © 2011 by Ballard Spahr LLP.
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