Consumer Financial Protection Bureau

Irene SkrickiApril 26, 2012

A (very brief) timeline2007• The United States starts facing its most significant financial crisis

since the Great Depression.

2009• President Obama proposes a consumer-protection bureau as part of

Wall Street reform.

July 21, 2010• The Dodd-Frank Wall Street Reform and Consumer Protection Act

becomes law. Implementation of CFPB begins immediately under the Treasury Department.

July 21, 2011• The CFPB becomes a bureau.

January 4, 2012• Richard Cordray named the first Director of the CFPB

2

A consumer finance marketplace…

where customers can see prices and risks up front and where they can easily make product comparisons;

in which no one can build a business model around unfair, deceptive, or abusive practices;

that works for American consumers, responsible providers and the economy as a whole.

Our Vision

3

The CFPB Toolbox:

Many Different Approaches

4

• Supervision/Examination/Enforcement

• Research, Markets & Regulations

• Consumer Response

• Consumer Education & Engagement

• External Affairs

Alternative Mortgage Transaction Parity Act

Consumer Leasing ActElectronic Fund Transfer ActEqual Credit Opportunity ActFair Credit Billing ActFair Credit Reporting ActHome Owners Protection ActFair Debt Collection Practices

ActFederal Deposit Insurance Act

(selected sections)Gramm-Leach-Bliley Act

(selected sections)

Scope of AuthorityEnumerated Statutes that the CFPB can Implement and

Enforce (as listed in Sec. 1002(12))Home Mortgage Disclosure

ActHome Ownership and Equity

Protection ActInterstate Land Sales Full

Disclosure ActOmnibus Appropriations Act

of 2009 (section 626)Real Estate Settlement

Procedures ActS.A.F.E. Mortgage Licensing

ActTruth in Lending ActTruth in Savings Act

5

• CFPB has authority to supervise and examine banks and credit unions with assets exceeding $10 billion, their affiliates and their service providers.

• Dodd-Frank defines "affiliates" to include any person that controls, is controlled by, or is under common control with another person. (Sec. 1002(1))

• "Service providers" are defined as companies providing a material service to a covered institution. (Sec. 1002(26)) "Material services" include designing, operating, or maintaining a consumer financial product or service and processing related transactions.

6

Depository Institution Supervision

1. All sizes of nonbank firms that offer or provide:

• Origination, brokerage, or servicing of residential mortgage loans, or loan modification and foreclosure relief services related to such loans

• Payday loans

• Private education loans

2. For other markets of consumer financial products or services, a “larger participants” of these markets as the CFPB defines by rule.

• Initial rule to be issued by July 21, 2012.

• Issued Notice and Request for Comment on larger participant rulemaking on June 29th, which asked in part how a larger participant in specific industries should be defined (over 10,400 comments received)

3. Other entities that the CFPB has reasonable cause to determine engage in conduct that poses risks to consumers related to consumer financial products or services, after notice and a reasonable opportunity to respond

Non-Depository SupervisionFirms Subject to CFPB’s Nonbank Supervision Program Under

Section 1024

7

Research, Markets & Regulation

8

Selected Reports Available on www.consumerfinance.gov:

• Impact of the CARD Act of 2009

• Use of Remittance History for Credit Scores and Remittance Exchange Rates

• Variation in Credit Scores

• Fair Debt Collection Practices Act

Consumer Responsewww.consumerfinance.gov

9

• Consumer Response now accepts complaints related to all bank products, including:• credit cards• mortgages• all bank accounts• private student loans

• Help available in 187 languages • (855) 411-CFPB (2372) (Eng./Esp.)• TTY/TDD (855) 729-CFPB (2372)

• Tell Your Story portal

Servicemembers

•Improve financial protection•Escalate complaints•Coordinate w/ DoD, etc.•26- 29 million

Older Americans

•Protect against financial abuse•Improve financial literacy•Planning for life events•50 million aged 62+

Students•Increase awareness of debt in college choice•Escalate complaints•Build campus awareness•22-28 million (age 16-26)

FinancialEmpowerment

•Improve financial stability for working families/new entrants•30 million underbanked•46 million lower income

CEE’s Offices

Financial Education• Provide targeted educational content• Identify and promote effective fin ed

practices

Consumer Engagement• Create interactive, informative

relationship with consumers

10

Welcome to the CFPB

11

Feedback?

Know Before You Owe: Student Loans

13

ConsumerFinance.gov/askcfpb

15

Office of Financial Education Objectives:

• Build a comprehensive approach to financial education in the U.S. Develop knowledge about what works in financial education and provide opportunities for financial educators to learn about effective strategies

• Promote innovation: Test new ideas and share successful innovations with the field

• Educate consumers: Provide understandable information to consumers that helps them make informed financial decisions

• Increase federal coordination: Director of the CFPB serves as the vice chair of the Financial Literacy and Education Commission

Build knowledge about what works

• Commission evaluations of promising financial education projects

• Link financial educators and researchers with each other in a learning network

Strengthen the field

• Share best practices

• Four listening sessions with financial education practitioners

• Additional webinars

• Tax-time savings materials for VITA sites

16TITLE YYYY/MM/DD

Build a comprehensive approach to financial education

Identify existing innovations in the field

Seed new innovations in the field

17

Promote Innovation

18

• Aspires to be a trusted resource for information for consumers and practitioners

• Identify and share innovative practices and communication strategies in financial education

• Work to provide consumer-focused materials in everyday language• Inform• Motivate• Help consumers achieve their own financial

goals

Educate Consumers

19

• FLEC is a 21-member federal commission charged with improving coordination on financial education among federal agencies

• Dodd-Frank Act names CFPB Director as the vice chair

• OFE is actively engaged with FLEC working groups

Improve Federal Coordination

How to ParticipateCFPB Blog: http://www.consumerfinance.gov/blog/

: https://help.consumerfinance.gov/app/tellyourstory

CFPB Twitter: @CFPB

CFPB Facebook: http://www.facebook.com/CFPB

Go to ConsumerFinance.gov to sign up for our newsletter.

Weigh in on current rulemakings: http://www.consumerfinance.gov/notice-and-comment/

20

Contact us:

financialeducation@cfpb.gov

Questions?