Federal Reserve Governor Stephen Miran explains how policy will be affected by the shutdown’s impact on employment data reporting on ‘The Claman Countdown’.
The Trump administration is in the process of rolling back Biden-era rules at the Consumer Financial Protection Bureau (CFPB), which required companies subject to federal regulatory orders to submit them for listing on CFPB registries.
“The Bureau is finalizing the repeal of the NBR rule based on concerns that the costs the rule imposes on regulated entities, which may be passed on to consumers, are not justified by the speculative and unquantified benefits to consumers discussed in the analysis provided in the NBR rule,” the bureau wrote.
The NBR rule was finalized in July 2024 and came into effect in September last year. The Biden-era CFPB believed the rule would advance the agency’s market monitoring and non-bank supervision responsibilities by collecting and publishing information about orders applicable to non-banks and the steps taken to comply with those orders.
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The Consumer Financial Protection Bureau (CFPB) plans to roll back some Biden-era rules. (Anna Moneymaker/Getty Images)
“Specifically, the agency believed that the Bureau’s establishment of a centralized system for collecting and publishing information about covered orders against covered nonbanks would lead to more efficient and effective monitoring, detection, assessment, public awareness, and mitigation of the risks consumers face from violations of the federal consumer financial law, including repeat violations,” the agency said.
The CFPB estimated that the compliance burden would involve 35 hours of paperwork, including five hours for the initial registration, and 30 hours for the annual report, including administration costs. It also estimated that the NBR rule would affect between 1,550 and 7,752 non-banks covered, and they would incur labor costs of $350 each for the initial registration and $2,100 for the annual reporting cycle.
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OMB Director Russell Vought also serves as acting director of the CFPB. (Andrew Harnik/Getty Images/Getty Images)
In withdrawing the rule, the CFPB determined that the “NBR Rule is not a necessary tool for monitoring and mitigating risks to consumers from bad actors,” in part because there are other federal and state agencies that enforce consumer finance laws.
Earlier this year, the CFPB announced that it would not enforce the NBR Orders Rule, and the upcoming order would formally withdraw the arrangement.
The CFPB also plans to withdraw a proposed rule that would collect information about non-banks’ supervised use of terms and conditions in contract forms that seek to limit consumers’ legal rights.
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Rohit Chopra served as chairman of the CFPB during the Biden administration. (Samuel Corum/Bloomberg via Getty Images/Getty Images)
Among the restrictions it sought to address were waivers claims that consumers can make in any legal action or to determine the timeframe or forum of any such action, limitations on companies’ liability to a consumer, limitations on consumers’ ability to participate in class action lawsuits, limitations on consumers’ ability to complain or post reviews, and arbitration agreements.
The CFPB said the rule would have imposed significant burdens on non-banks that are “not justified by their uncertain and speculative benefits.” The agency added that it considered changes and updates to its policies, agenda and objectives in withdrawing the proposed rule.
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The proposed rule was published on February 1, 2023, but was not yet final and will be withdrawn pursuant to the pending CFPB filing.
