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CBA Comment Letter re RFI on Inherited Regulations and Inherited Rulemaking Authorities
June 25, 2018
Submitted via regulations.gov
Monica Jackson, Office of the Executive Secretary
Bureau of Consumer Financial Protection
1700 G Street NW
Re: Request for Information Regarding the Bureau’s Inherited Regulations and Inherited Rulemaking Authorities (Docket No. CFPB-2018-0012)
Dear Ms. Jackson,
The Consumer Bankers Association1 (“CBA”) appreciates the opportunity to comment on the Bureau of Consumer Financial Protection’s (“Bureau”) inherited regulation and rulemaking authorities.2 CBA’s members work every day to comply with the Bureau’s various inherited regulations, while providing financial security for millions of consumers.
Banking has changed dramatically in the short time since the Bureau was established. Most notably, every aspect of banking is becoming more digital, from the internal processes at each institutions, to how our member’s customers interact with their financial institution. As the way our members do business transforms to reflect the rapid changes technology has brought to their doorsteps, CBA members need rules and regulations that reflect the digital world in which we now live, while maintaining the flexibility to adjust to emerging opportunities and challenges presented in this new landscape. As such, we recommend the Bureau examine the following recommendations, and most importantly, update the inherited regulations to reflect the drastic changes new and developing technologies has had on how financial institutions best serve their customers.
I. Issues Reaching Across Multiple Inherited Regulations
In addition to examining how updates in technology has changed the inherited regulations since the Bureau took over responsibility for them, the Bureau should establish a process to review rules on a regular basis as the landscape of financial services changes. Taking an internal review of every inherited rule to address the challenges and opportunities new technology brings to the industry is key to ensuring financial institutions are well poised to serve the financial needs of consumers today, and into the future. Additionally, the Bureau should undertake the following recommendations as they apply to multiple inherited regulations.
a. Update and Harmonize Regulations Dealing with Electronic or Digital Advertising and Disclosures
Regulations X, Z, and DD all have standards establishing the prominence and proximity for various disclosures, including where certain disclosures must be displayed, how they must be displayed, and what disclosures they should be grouped together with. These regulations should be amended and harmonized to indicate that the prominence and proximity standards they include meet the “clear and conspicuous” standards for all applicable electronic advertisements and disclosures set forth in the Regulations.
Regulations B, E, X, V, Z, and DD should be amended to better clarify that required language, including required disclosures and language related to advertisements, may be provided to consumers via a hyperlink, when included in an electronic document. This will greatly increase the accessibility of the required language for consumers. To this end, the Bureau should issue similar guidance on disclosure requirements to harmonize the requirements of the Homeowners Protection Act.
Accordingly, the required language should be considered:
· Prominent if:
o It is at least the same size as the trigger term; or
o Where it is provided through a separate link, the link is as prominent as
the trigger term.
· Proximate if:
o It is in close proximity to the trigger term;
o Where it is provided through a separate link, the link is in close proximity to the trigger term; or
o The trigger term itself links to it.
Amending the above regulations to allow financial institutions to better provide electronic disclosures will help lead to better informed consumers as electronic disclosures can be expanded to accommodate the individual needs of the document they appear on, and can easily be printed in a large format.