In a comment letter to the Consumer Financial Protection Bureau today — the fourth of 12 the association will submit as part of the bureau’s ongoing feedback initiative — ABA called on the bureau to seek resolution of regulatory violations and compliance management weakness through the supervisory process rather than rushing to enforcement actions.
“An integral part of supervision — and avoiding unnecessary reliance on enforcement actions — is identifying weaknesses and potential violations early and working with the bank to resolve them before they become bigger issues and create greater problems,” ABA said. “To date, the bureau’s emphasis on enforcement has crowded out supervisory solutions that would be less costly, more certain to benefit consumers and better for the financial services marketplace as a whole.”
To that end, the association emphasized the need for improved communications, both between the bureau and the entities it regulates and with its examiners in the field. ABA also called for increased cooperation between the bureau and the other federal regulatory agencies; more judicious use of Matters Requiring Attention and Potential Action and Request for Response letters; investing in more training resources for bureau’s examination team; providing forums to help regulated institutions understand the bureau’s Supervisory Highlights publications; and improving the appeals process.
