CFPB Pledges More Transparency in Civil Investigative Demands

The Consumer Financial Protection Bureau today announced that it will change its policy on civil investigative demands to improve transparency. The changes align with recent court decisions and are consistent with feedback received during its 2018 review of regulations and enforcement practices, including from the American Bankers Association.

“Consistent with the updated policy, CIDs will provide more information about the potentially applicable provisions of law that may have been violated,” the CFPB said. “CIDs will also typically specify the business activities subject to the bureau’s authority. In investigations where determining the extent of the bureau’s authority over the relevant activity is one of the significant purposes of the investigation, staff may specifically include that issue in the CID in the interests of further transparency.”

In its 2018 comment letter, ABA pointed out that while CIDs can be important investigatory tools if carefully used, they can be and have been employed abusively in ways that violate reasonable due process and frustrate the pursuit of justice. The association specifically urged the bureau to provide CID recipients more information about the underlying purpose of the CID. For more information, contact ABA’s Virginia O’Neill.