CFPB Issues Final Rule on Nonbank Registration of Enforcement Orders

On June 3, the Consumer Financial Protection Bureau (CFPB or Bureau) issued its final rule requiring covered nonbanks to register enforcement orders, and it is a doozy. Not only will covered nonbanks be required to register public orders issued by agencies and courts with the CFPB, but they will have to go back to 2017. And not only will the CFPB publish the orders, but a large subgroup will have to certify on a yearly basis their full compliance with the orders or make a self-disclosure to the CFPB of any compliance failures. This rule has obvious major consequences for any covered person caught in its web, making the exact ambit of the rule crucial. Given the final rule clocks in at a whopping 486 pages, this post will attempt to provide a roadmap through the rule, focusing on what is required and who is covered.

Who is Covered

The final rule applies to certain nonbanks that are “covered persons” under the Dodd-Frank Act. Covered persons generally participate in offering or providing consumer financial products or services. However, the rule does not apply to insured depository institutions or insured credit unions, persons who are covered solely due to being a “related person” under the Dodd-Frank Act, states including federally recognized Indian tribes, natural persons, certain motor vehicle dealers, and persons that qualify as a covered person under the Dodd-Frank Act only because of conduct excluded from the CFPB’s rulemaking authority.