The CFPB established a Pilot Advisory Opinion ("AO") Program to create a mechanism through which the agency may better enabl[e] compliance in the face of "regulatory uncertainty." Under the pilot program, parties can request an advisory opinion to clarify regulatory or statutory ambiguities.
The CFPB will focus on (i) providing timely and clear information to consumers, (ii) identifying regulations that are outdated, unnecessary, or unduly burdensome, (iii) maintaining consistent enforcement practices regarding Federal consumer financial law to "promote fair competition," and (iv) ensuring transparent and efficient functioning of consumer financial product and service markets.
The CFPB indicated that it will consider the following factors, among others, in determining whether to address certain topics through AOs:
- whether the interpretive issue has been noted during prior CPFB examinations as one potentially benefiting from further regulatory clarity;
- whether the issue is of "substantive importance" or whose clarification would provide "significant benefit"; and
- whether the issue is one that has not been "previously addressed through an interpretive rule or other authoritative source."
The CFPB also stated that there would be a strong presumption against issuing an AO where (i) the interpretive issue is the subject of ongoing CFPB investigation or enforcement activity, (ii) the interpretive issue is the subject of an ongoing or planned rulemaking, (iii) the interpretive issue could be addressed sufficiently through a Compliance Aid, or (iv) there is CFPB or court precedent that is both sufficiently clear and already available to the public regarding the issue.
AOs will be posted on the CFPB website and published in the Federal Register.
Originally published June 19, 2020.
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