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CBA's Public Policy Issues

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CFPB Report
June 22, 2012

CFPB Unveils Credit Card Complaint Database
On Tuesday, June 19, 2012, the CFPB unveiled a database of complaints the agency has received about credit card companies since June 1, 2012. The CFPB said it will publish complaints only after it has verified a consumer’s relationship with the issuer. The posted complaints will provide detailed information on the nature of the various disputes, how they are being resolved, the complainant’s ZIP code, and will include the issuer’s identity. Complaints filed before June will be added later after beta testing is complete.

“Each and every time we hear from American consumers about their troublesome transactions with financial products, it gives us important insight,” said Director Cordray in the agency’s press release. “The information helps us and it should be available to help others too. By making our data publicly available, initially in the area of credit cards, we hope to improve the transparency and efficiency of this essential consumer market.”

“It’s an unlevel playing field,” said CBA's President and CEO Richard Hunt in response to the announcement. “It appears to be a gotcha mentality when it didn’t have to be that way.” In a January 2012 comment on the agency’s proposal, CBA urged the agency to exclude issuer specific information on credit card complaints. As outlined in the comment, CBA firmly believes the inclusion of issuer identification in any complaint process will have serious adverse implications for consumers and card issuers alike. The inclusion of this information falls outside the scope of the agency’s statutory reporting mandate and could lead to serious privacy concerns for consumers. Additionally, the disclosure of an issuer’s identification will NOT aid the agency in providing consumers with timely and understandable information about credit cards or improve the functioning of the credit card market.

The list of complaints is intended to expand in the future to include data on other financial service products. Also on Tuesday, the CFPB submitted to the Federal Register a request for comments on extending the database to financial products other than credit cards. The comment period will be open until July 19, 2012.

CFPB Issues Joint Guidance on Mortgage Servicing for Service Members
On Thursday, June 21, 2012, the CFPB along with the other federal financial service regulators announced guidance concerning mortgage servicing practices that may pose risks to homeowners serving in the military. The agencies' announcement outlines what loan servicers should do with regard to explaining options when a service member informs the servicer that he/she has received a Permanent Change of Station Order.

“Those who serve our country deserve to be given the best service by their mortgage servicer,” said Director Cordray in an agency press release. “Permanent Change of Station orders can complicate a service member’s homeownership decisions in ways that civilians may not experience. This guidance provides specific notice to mortgage servicers that this country already has substantial laws in place to help military members in this still-recovering housing market.”

CFPB Announces Changes in Senior Management
On Tuesday, June 19, 2012, the CFPB announced substantial changes to its senior staff. Len Kennedy will be transferring out of his current position as General Counsel and will be replaced by Director Cordray’s Chief of Staff, Meredith Fuchs. Fuchs joined the Bureau in 2011 as Principal Deputy General Counsel before serving as Chief of Staff to CFPB Director Richard Cordray. Prior to joining the CFPB, she served as Chief Investigative Counsel of the United States House of Representatives Committee on Energy and Commerce. Previously, Fuchs held positions as Vice President and General Counsel of the National Security Archive at George Washington University, litigation partner at Wiley Rein LLP, and an officer on the D.C. Bar Board of Governors. Kennedy will remain with the agency as Senior Advisor and Counselor to Cordray.

Steve Antonakes, who previously served as the agency’s Assistant Director of Large Bank Supervision, has been selected to now lead both supervision and enforcement. As such, Antonakes will serve as the Associate Director for Supervision, Enforcement, and Fair Lending at the CFPB. Antonakes began his professional career as an entry-level bank examiner with the Commonwealth of Massachusetts Division of Banks in 1990. He served in numerous managerial capacities before being appointed by successive Governors to serve as the Commissioner of Banks from December 2003 until November 2010.

"I am very pleased to announce these updates to the CFPB leadership team,” said Cordray in the agency’s press release. “As the CFPB continues moving forward with its important work, we are leveraging the collective expertise of our dedicated senior staff to better serve consumers and fulfill the CFPB’s mission of making consumer financial markets more fair, transparent, and competitive.”

Other key announcements were made by the agency, including the official appointment of Wendy Kamenshine as the permanent CFPB Ombudsman.

House Conducts Hearing with CFPB on Simplified Mortgage Disclosures
The House Committee on Financial Services Subcommittee on Insurance, Housing and Community Opportunity held a hearing entitled, “Mortgage Disclosures: How Do We Cut Red Tape for Consumers and Small Businesses?” on Wednesday, June 20, 2012. Witnesses included Mr. Raj Date, the CFPB Deputy Director, and a second panel of witnesses representing the mortgage lending industry. Discourse focused on simplifying mortgage disclosure forms and making them available in advance of the closing.

Subcommittee Chairwoman, Judy Biggert (R-IL), has urged regulators to streamline mortgage disclosure forms. Date admitted to the Subcommittee that he did not read the disclosure forms when he bought a home recently. Ranking Member Gutierrez (D-IL) expressed support for merging TILA and RESPA forms as mandated under Dodd-Frank. Additionally, the rulemaking timelines for QM, QRM, and mortgage disclosure rules were discussed. Date testified that the QM and QRM rules will be finalized by their statutory deadline and could be finalized before the mortgage disclosure rule.

CBA submitted a letter to the Subcommittee leadership stating our support for clear and easy to understand disclosures that are meaningful for consumers. CBA also expressed concern over the process at the CFPB and the possible negative outcomes of the rule. “We have concerns with the process of combining the TILA/RESPA disclosures, as well as concerns on possible substantive changes to the TILA/RESPA rules that the Consumer Financial Protection Board (CFPB or Bureau) may propose as part of this initiative,” CBA stated in the letter.