CFPB Director Rohit Chopra has wasted no time in acting on comments he made at his confirmation hearing regarding the risks posed by the collection of data by large platforms. In just his first full week as CFPB Director, the CFPB sent orders to six technology platforms offering payment services directing them to provide information to the Bureau. The orders were issued as market monitoring orders under the Dodd-Frank Act, which directs the Bureau to monitor for risks to consumers in the offering or provision of consumer financial products or services and authorizes the Bureau to require covered persons and service providers to provide information needed to perform such monitoring.
In his statement about the orders, Director Chopra raised numerous concerns about Big Tech companies’ use of the data collected on their payments platforms. He indicated that the CFPB’s inquiry “will help to inform regulators and policymakers about the future of our payments system” and “will also yield insights that may help the CFPB to implement other statutory responsibilities, including any potential rulemaking under Section 1033 of [Dodd-Frank].” (Section 1033 requires consumer financial services providers to give consumers access to certain financial information and is the subject of an Advance Notice of Proposed Rulemaking issued by the Bureau in October 2020.)
The orders require responses by December 15, 2021. However, in light of the breadth of the information requested, it would not be surprising for the recipients of the orders to seek additional time to respond. The orders request detailed information about the following:
The Bureau’s issuance of the orders was praised by the Consumer Bankers Association. In its statement about the orders, CBA applauded the Bureau “for advancing the Bureau’s mission of protecting consumers in the rapidly evolving financial marketplace,” observing that “[s]ince the Bureau was founded, a growing share of banking activity has occurred outside of the purview of leading regulators, putting consumers and the resiliency of the financial system at risk.” CBA reiterated its long-standing support for “ a level playing field to ensure every American family receives the protections they deserve, regardless of where they go to meet their financial needs.”
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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
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