The Consumer Financial Protection Bureau (CFPB) plans to hold a symposium discussing the Dodd-Frank Act provision pertaining to small business lending data collection requirements. The event will be held Nov. 6 and represent the third in the CFPB’s symposia series initiated by Kraninger earlier this year to facilitate dialogue on topics related to rulemaking and consumer protection policies.
The CFPB is required to issue rulemaking pertaining to small business lending activities under Section 1071 of the Dodd-Frank Act. The provision amends the Equal Credit Opportunity Act (ECOA) to require financial institutions to report information concerning credit applications made by women-owned, minority-owned small businesses.
As did the first two events in the series, the third symposium will feature remarks by CFPB Director Kathy Kraninger and consist of two panels of experts.
The first panel will focus on the current state of, and future outlook for, the small business lending marketplace, according to the bureau. The second panel will include a discussion surrounding the implementation of Section 1071.
In its Spring 2019 Unified Agenda, the first released under Kraninger, the CFPB moved the rulemaking up to the “pre-rule” stage and stated that it planned to commence rulemaking activity January 2020.
Under former acting director Mick Mulvaney, the CFPB moved its plans for Section 1071 rulemaking from the pre-rule stage to the “long-term” rulemaking stage in its Fall 2018 Unified Agenda “in light of other responsibilities.” The rulemaking had been in the pre-rule stage when the bureau released its rulemaking agenda for Spring 2018.
The CFPB published a Request for Information (RFI) in May 2017, urging industry stakeholders to weigh in on the types of credit products lenders offer and the types of data lenders collect in the small business market. The RFI specifically asked commenters to address the potential complexity, cost of and privacy issues related to, small business data collection to help the bureau determine the most efficient, least burdensome way to implement the rule. Multiple financial trade organizations expressed concerns at the time that the implementation of Section 1071 requirements would adversely impact smaller lenders’ ability to serve small businesses.
Former CFPB Director Richard Director Richard Cordray faced harsh criticism from Republicans for the bureau’s failure to issue rulemaking implementing Section 1071 provisions under his watch.
In an April 2017 hearing before the House Financial Services Committee, Chairman Jeb Hensarling (R-Texas) told Cordray that his failure to promulgate the statutorily required rulemaking could be grounds for the president to remove him from office under the Dodd-Frank for-cause removal provision that now is pending a Supreme Court ruling.
As with the first two events, the third symposium also will be live-streamed on the CFPB’s website, beginning at 9:30 a.m.
The bureau held its first symposium in the series, covering Dodd-Frank’s prohibition against abusive acts or practices, on June 25. The second symposium on Sept. 19 addressed matters relating to behavioral law and economics.