[Federal Register Volume 86, Number 64 (Tuesday, April 6, 2021)]
[Rules and Regulations]
[Pages 17699-17700]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-06964]


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BUREAU OF CONSUMER FINANCIAL PROTECTION

12 CFR Chapter X


Rescission of Statement of Policy on Bureau Supervisory and 
Enforcement Response to COVID-19 Pandemic

AGENCY: Bureau of Consumer Financial Protection.

ACTION: Rescission of statement of policy.

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SUMMARY: The Bureau of Consumer Financial Protection (Bureau) is 
rescinding the Statement on Bureau Supervisory and Enforcement Response 
to COVID-19 Pandemic.

DATES: This rescission is applicable on April 1, 2021.

FOR FURTHER INFORMATION CONTACT: Mehul Madia, Division of Supervision, 
Enforcement, and Fair Lending, at (202) 435-7104. If you require this 
document in an alternative electronic format, please contact 
[email protected].

SUPPLEMENTARY INFORMATION: On March 26, 2020, the Bureau issued a 
statement entitled, ``Statement on Bureau Supervisory and Enforcement 
Response to COVID-19 Pandemic'' (Statement), regarding the Bureau's 
exercise of its supervisory and enforcement discretion during the 
pandemic.\1\ Specifically, the Statement provided that the Bureau would 
take into account staffing and related resource challenges confronting 
financial institutions and their counsel as they relate to supervisory 
activities and enforcement actions. The Statement also noted that when 
conducting examinations and other supervisory activities and in 
determining whether to take enforcement action, the Bureau will 
consider the circumstances that entities may face as a result of the 
COVID-19 pandemic and will be sensitive to good-faith efforts 
demonstrably designed to assist consumers.
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    \1\ https://files.consumerfinance.gov/f/documents/cfpb_supervisory-enforcement-statement_covid-19_2020-03.pdf.
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    The Bureau hereby rescinds, as of April 1, 2021, the Statement and 
announces its intent to exercise its supervisory and enforcement 
authority consistent with the Dodd-Frank Act and with the full 
authority afforded by Congress consistent with the statutory purpose 
and objectives of the Bureau.
    The Statement expressed the Bureau's recognition of the impact of 
the COVID-19 pandemic on the operations of many financial institutions, 
including staffing and related resource challenges confronting 
financial institutions and their counsel. The Bureau has concluded that 
since release of this statement such circumstances have changed. Since 
March 2020 and over the course of the COVID-19 pandemic, financial 
institutions and other entities that provide financial services and 
products to consumers have adjusted operations by, for example, 
shifting to a remote mode of operation. As States and other 
jurisdictions have rescinded and modified stay-at-home orders over the 
course of the pandemic, many financial services entities have resumed 
some level of in-person operations and, in many instances combined with 
more robust remote capabilities, have demonstrated improved business 
continuity.
    With regard to the temporary flexibility announced in the 
Statement, the Bureau believes that companies should have had 
sufficient time to adapt to the pandemic and should now be able 
adequately to comply with the law and respond to enforcement actions or 
supervisory activities without the flexibility afforded under the 
statement. In addition, because the Statement did not create binding 
legal obligations on the Bureau or create or confer any substantive 
rights on external parties, it did not create any reasonable reliance 
interests for industry participants.

[[Page 17700]]

Indeed, the Bureau never intended the Statement to be permanent, and 
accordingly expressly framed the Statement as temporary relief.
    The Bureau continues to encourage institutions to meet the 
financial services needs of their customers affected by the COVID-19 
pandemic.
    The COVID-19 pandemic is a national emergency that threatens the 
financial well-being of millions of Americans, with particularly dire 
effects to communities of color. As the pandemic continues to unfold, 
consumers are facing economic hardship and compliance with Federal 
consumer financial law therefore is of paramount importance. The 
Bureau's statutory purposes include ``ensuring . . . that markets for 
consumer financial products and services are fair, transparent, and 
competitive.'' 12 U.S.C. 5511(a). Declining to cite conduct consistent 
with the full scope of the Bureau's supervision authority based on the 
articulated principles in the Statement may skew the consumer financial 
marketplace, to the detriment of market participants who comply with 
the law. To fulfill its statutory mandate, the Bureau has made it a 
priority to direct its supervisory, enforcement, and other tools to the 
prevention of harm to consumers from unlawful acts, policies, and 
practices. It is therefore of critical importance that institutions 
adhere to consumer protection requirements, including fair lending 
laws, in their interactions with consumers, and that the Bureau use its 
supervisory and enforcement tools to the full extent and with the full 
flexibility afforded by Congress.
    The Bureau is therefore rescinding the Statement, applicable as of 
April 1, 2021.\2\ Instead, in its discretion, the Bureau intends to 
exercise its supervisory and enforcement authority using a risk-based 
approach and considering responsible business conduct, consistent with 
the Dodd-Frank Act and with the full authority afforded by Congress 
consistent with the statutory purpose and objectives of the Bureau.\3\
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    \2\ Last year, the Bureau, along with the Board of Governors of 
the Federal Reserve, the Federal Deposit Insurance Corporation, the 
National Credit Union Administration, the Office of the Comptroller 
of the Currency (the ``Agencies'') issued statements entitled 
``Interagency Statement on Loan Modifications and Reporting for 
Financial Institutions Working with Customers Affected by the 
Coronavirus'' (April 7, 2020) (the ``April 7 Interagency 
Statement''), and ``Interagency Statement on Appraisals and 
Evaluations for Real Estate Related Financial Transactions Affected 
by the Coronavirus'' (April 14, 2020) (the ``April 14 Interagency 
Statement''). Both statements provided that the Agencies did not 
intend to take public enforcement actions against entities in 
certain instances. The April 7 Interagency Statement focused on loan 
modifications and stated that the agencies ``do not expect to take a 
consumer compliance public enforcement action against an 
institution, provided that the circumstances were related to the 
National Emergency and that the institution made good faith efforts 
to support borrowers and comply with the consumer protection 
requirements, as well as responded to any needed corrective 
action.'' Under the April 14 Interagency Statement, the agencies, as 
defined in that Statement, addressed flexibilities under certain 
appraisal standards. To the extent that the Bureau indicated 
flexibility, it now intends to exercise its supervisory and 
enforcement authority consistent with the Dodd-Frank Act and with 
the full authority afforded by Congress. As detailed in the 
Statement it is issuing today, the Bureau believes the circumstances 
described in the April 7 Interagency Statement and the April 14 
Interagency Statement have changed and that companies should have 
had sufficient time to adapt. As such, the Bureau does not intend to 
continue to provide any flexibilities afforded entities in these 
specific sections of both the April 7 Interagency Statement and the 
April 14 Interagency Statement.
    \3\ See, e.g., CFPB Bulletin 2020-1, Responsible Business 
Conduct: Self-Assessing, Self-Reporting, Remediating, and 
Cooperating, available at https://files.consumerfinance.gov/f/documents/cfpb_bulletin-2020-01_responsible-business-conduct.pdf.
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Regulatory Requirements

    The Statement constituted a general statement of policy exempt from 
the notice and comment rulemaking requirements of the Administrative 
Procedure Act (APA). It was intended to provide information regarding 
the Bureau's general plans to exercise its supervisory and enforcement 
discretion and did not impose any legal requirements on external 
parties, nor did it create or confer any substantive rights on external 
parties that could be enforceable in any administrative or civil 
proceeding. This rescission likewise is a general statement of policy 
exempt from the notice and comment rulemaking requirements of the APA. 
It is intended to provide information regarding the Bureau's general 
plans to exercise its supervision and enforcement discretion and does 
not impose any legal requirements on external parties or create or 
confer any substantive rights on external parties that could be 
enforceable in any administrative or civil proceedings. No notice of 
proposed rulemaking was originally required in issuing the Statement 
and it is not required in issuing this rescission. The Regulatory 
Flexibility Act also does not require an initial or final regulatory 
flexibility analysis for this rescission. The Bureau has also 
determined that the rescission of the Statement does not impose any new 
or revise any existing recordkeeping, reporting, or disclosure 
requirements on covered entities or members of the public that would be 
collections of information requiring approval by the Office of 
Management and Budget under the Paperwork Reduction Act.

    Dated: March 29, 2021.
David Uejio,
Acting Director, Bureau of Consumer Financial Protection.
[FR Doc. 2021-06964 Filed 4-5-21; 8:45 am]
BILLING CODE 4810-AM-P