The bill signed by President Barack Obama on April 15, 2011, to resolve the federal budget impasse requires two annual audits of the Consumer Financial Protection Bureau (CFPB) and an annual study of its regulations.

The Department of Defense and Full-Year Continuing Appropriations Act, 2011, amends Title X of the Dodd-Frank Wall Street Reform and Consumer Protection Act to add the following two new sections:

  • Section 1016A requires (1) the CFPB to order an annual independent audit of its operations and budget, and (2) the Government Accountability Office (GAO) to order an annual audit of the CFPB’s financial statements using generally accepted government accounting standards.

  • Section 1016B requires the GAO to conduct an annual study of financial services regulations, including the CFPB’s activities. The study must provide an analysis of the impact of regulation on the financial marketplace, including (1) the effects on the safety and soundness of regulated entities, (2) the cost and availability of credit, (3) savings realized by consumers, (4) reductions in consumer paperwork burden, (5) changes in personal and small business bankruptcy filings, and (6) costs of compliance with rules, including whether sound cost-benefit analysis is being applied by relevant federal regulators in promulgating rules. The study must also include an analysis of efforts to avoid duplicative or conflicting rules. The GAO must issue a report to Congress within 30 days of completing a study detailing its findings, conclusions, and recommendations. Initial audits must be completed by October 12, 2011,  and an initial study must be conducted by that date.

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 kaplinsky@ballardspahr.com; Vice Chair Jeremy T. Rosenblum, 215.864.8505 or rosenblum@ballardspahr.com; John L. Culhane, Jr., 215.864.8535 or culhane@ballardspahr.com; Keith R. Fisher, 202.661.2284 or fisherk@ballardspahr.com; Barbara S. Mishkin, 215.864.8528 or mishkinb@ballardspahr.com; or Mark J. Furletti, 215.864.8138 or furlettim@ballardspahr.com.

 

 


 

 

 

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