Senate, House resolutions condemn CFPB data collection rule

Lawmakers in the House and Senate have introduced resolutions of disapproval under the Congressional Review Act to overturn the Consumer Financial Protection Bureau’s final rule implementing Section 1071 of the Dodd-Frank Act, which requires the collection and reporting of credit application data for small businesses, including women-owned and minority-owned small businesses. The resolution would need to be adopted by both houses of Congress and signed by the president to overturn the rule.

Rep. Roger Williams (R-Texas) introduced the resolution in the House while Sen. John Kennedy (R-La.) introduced a companion resolution in the Senate. The House version currently has 23 cosponsors while the Senate version has 29 cosponsors.

American Bankers Association President and CEO Rob Nichols in March said that banks oppose discrimination in any form and support enforcement of fair lending laws, but the final rule was unnecessarily far-reaching and would harm the relationship banking model. “Given the cost of implementing these significant new reporting requirements and their impact on lending, some community banks may be forced to limit their small-business loan programs,” he said. Nichols added that ABA was concerned that the data produced would put small-businesses’ privacy at risk and could provide a potentially misleading picture of small business lending to underserved groups.