With four active lawsuits against regulatory agencies, ABA President and CEO Rob Nichols emphasized Monday that filing a lawsuit is “not the first tool in the box. It’s the very last one.” The four lawsuits address Section 1071 of the Dodd-Frank Act, the CFPB’s UDAAP manual, the Community Reinvestment Act final rule and the CFPB’s late fees rule.
Nichols addressed the opening session of the American Mortgage Conference in Savannah, Georgia, co-sponsored by ABA and the North Carolina Bankers Association. Fellow panelist Bob Broeksmit, the president and CEO of the Mortgage Bankers Association, added that even when a proper regulatory process results in outcomes industry doesn’t like, industry deals with it. “But in these cases where you don’t follow the Administrative Procedure Act, you don’t have a viable result.”
Nichols and Broeksmit also tackled the CFPB and Biden administration campaign against fees in business. “The way banks disclose fees and regulators oversee them is sharply different from airlines, Ticketmaster, etc.,” Nichols said. “Every industrial sector can charge fees for services; we believe banks can as well.”
Broeksmit cited efforts by the administration to brand fees for credit reports, title insurance and appraisals as “junk fees,” even though mortgage lenders charge for and disclose these charges under CFPB regulation. Moreover, he added, “We can’t deliver a mortgage to the government entities . . . without an appraisal, credit report or title insurance.”
Nichols also emphasized areas where ABA sees agreement with the CFPB, particularly strengthening enforcement of nonbank market participants, keeping “big tech” out of banking and querying core providers over costs, contracts and service levels. “We are not anti-CFPB in any way, shape or form,” Nichols said.
