Three GOP lawmakers today raised concerns about the CFPB’s pending rulemaking to implement Section 1071 of the Dodd-Frank Act. Citing concerns received from industry stakeholders, including banks of all sizes, Reps. Blaine Luetkemeyer (R-Mo.), French Hill (R-Ark.) and Roger Williams (R-Texas) flagged several issues and called on the CFPB to remedy these issues within the final rulemaking.
In particular, the lawmakers expressed concerns about the potential effects of the rule on small banks, and urged the CFPB “to exclude as many small financial firms as possible,” and also called for a longer implementation period, given the complexity of the rule.
The lawmakers also took issue with a provision of the proposed rule that would require financial institutions to guess the race of applicants who choose not to provide their information. “Loan officers at financial institutions have no expertise to determine the race or ethnicity of individuals, nor should they,” the lawmakers wrote, calling for the removal of the provision. Finally, they emphasized that the CFPB “must fully disclose what information will become public before the final rule is issued and must conduct a separate rulemaking process, including notice and comment, related to this provision of the law.”
The lawmakers’ concerns echoed several previously raised by the American Bankers Association and the state bankers associations in their comment letter to the bureau last month.